Collision Car Insurance Coverage Explained
You do not have to be an auto insurance agent or an underwriter to understand that basics of auto insurance. In fact, as an educated consumer, you should take time to know the basics of car insurance and how each coverage you invest in works before you start comparing auto insurance quotes or purchase a policy. One coverage that may confuse you when you are comparing premiums and building a customized policy is collision coverage. Learn why you need collision insurance and what it will cover when you are involved in an accident.
What is Collision Coverage?
Collision coverage is an optional coverage that is not required by state law. Unlike liability coverage, collision is physical damage cover that will pay for damage to your car when you are at-fault for an accident. Collision will also pay to cover damages if you are not at-fault and you are hit by a motorist who does not have Property Damage insurance that would normally cover the cost of repairs.
How Much Will the Coverage Pay?
If you are involved in an at-fault or uninsured motorist accident, you will need to contact your insurer to file a claim. The policy will pay for repairs, up to the fair market value of the vehicle, or will total the vehicle and issue you a check for replacement if the damages exceed the fair market value. The fair market value is the current diminished value of the vehicle based on age, mileage, condition and location. Almost all policies come with a deductible. The collision deductible is the amount of money that you are obligated to pay before the insurer will issue a claims payment. If the damages incurred to your vehicle in the accident is less than your deductible, your collision cover will not pay.
Who Needs Collision Coverage?
While collision is not required by law in any state, if your vehicle is financed, your finance company will require you to carry physical damage coverage. This requirement is to protect the finance company’s interest in the vehicle, as they are the legal owner of the car until the loan is paid off. Even if you hold the title to your vehicle, you may need to consider purchasing collision cover. You must consider the fair market value of the vehicle, the cost of carrying full coverage, and whether or not you can afford to replace your car on your own if you do not have physical damage coverage. It is best to do a costs vs. benefits analysis to make the best choice.
When you are comparing car insurance quotes, it is a good idea to quote the price of collision insurance with several different deductibles. Remember that the higher the deductible you choose, the lower the premiums. You should also remember that you will take on more of the burden of paying for repairs when you select a high deductible. Compare the premiums, determine whether or not you need to coverage, and make the right investment when you are buying your insurance policy.
Ways to Find the Best Full Car Insurance Coverage
Having car insurance is one of the most important things in your life. Auto insurance protects both you and other drivers on the road in the case of an accident. There are also many other additions to your auto insurance policy that can help you along the way. Taking out a full car coverage policy is ideal if you do not want to have any worries while you are driving. There are a few key things added onto a full car coverage policy that might not be added onto most others due to the price involved. Things included on full coverage policies would be collision, which means that you will be covered if you are the one at fault in an accident. Your policy will also include comprehensive, which means that acts of nature are covered. This simply means that you will be covered if you get into a collision with an animal or if a branch falls onto your car while it is parked or driving. Most full coverage policies also include roadside assistance and rental car fees so that these are things that you do not have to worry about in the future while you are out on the road.
One thing about full coverage car insurance policies is that they can be relatively expensive simply because everything is included. While these types of policies will be more expensive, doing car insurance quotes beforehand will help you to save a decent amount of money. Getting a quote is completely free and will show you different companies as well as their fees for full coverage insurance. You will be able to determine which company is offering the best deal and how affordable the coverage is going to be if you make the decision to take out a policy. Keep in mind that once you take out a policy with a company, you can make changes to the type of coverage you have.
Even though full coverage insurance is quite expensive and your bill will be a bit higher than basic insurance, you can get a lowered price when you do auto insurance quotes on the Internet. Also, better insurance gives you that much-needed peace of mind in knowing that you are fully protected while out and about in your car. Getting full coverage might even be essential if your car is going to be driven by a teenager or someone who is elderly. The whole point of having this type of insurance is so that you do not have to worry about not being covered in the case of an emergency in the future.
You never know what could happen while you’re driving your vehicle. It is easy to say that you’re a safe driver and will never get into an accident, but you also do not know what the future holds. By carrying full coverage on your auto insurance policy, you will not have to worry about being left in the dust if you get into an accident or even if you just need quick roadside assistance.