Collision Coverage

Collision coverage will pay to repair or replace your vehicle if you are at-fault in an accident. As with comprehensive coverage, collision coverage is not required under any state law. If you have a car loan, your lender may require you to purchase this coverage. Collision auto insurance is designed to protect your investment (your car) and the lender’s investment (your car loan). The maximum amount that will actually be paid out is the car's actual cash value minus the deductible you choose when you purchase your policy.

Collision coverage is more pertinent when your car is newer. If you damage your car and do not have collision auto insurance or the finances to pay for the repairs, you could be paying a car loan for a car you cannot drive.

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Costs of Collision Coverage

The deductible (the money you must pay up front before your insurance company pays out any money for damages) for this type of coverage can range anywhere from $250 to $1,000. The higher the deductible you choose, the lower your premium. You can save money by choosing a higher deductible and driving safely. If you are found to be not at fault for the accident, your insurance company will try to recover the deductible from the other driver’s insurance policy. If they do so successfully, the deductible you paid will be reimbursed. Generally, you only pay the deductible on collision auto insurance if the accident is your fault.

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**Auto Insurance Finder is not an insurance broker or carrier. Content on this site is for comparison and informational purposes only. The products and services listed on this site may not be available in all states.

Last Updated: November 10, 2009