Automotive Insurance for Car Collisions
It’s sometimes easy to get a little paranoid when you are buying car insurance. As you look at various premiums and the large dollar amounts associated with them, your mind may become fixated on worrying about property damage or bodily injury in the event of a crash. And considering that all 50 states require some measure of liability insurance to help protect you from the high costs associated with bodily harm or property damage, it’s admittedly easy to hone in on that component of insurance. However, even as you focus on the liability aspect of car insurance, there’s still one very crucial element that you should not forget about: Collision car insurance coverage.
A Very Big Difference
At first, you may hear the term collision coverage and assume that it’s associated with liability coverage. However, the difference between liability car insurance coverage and collision car insurance coverage is pretty monumental. When you have collision coverage as part of your auto insurance plan, your insurance carrier will pay for the damages done to your car in the event of a wreck. Collision coverage applies when you:
- Hit another car, whether it’s in motion or stationary.
- Hit a pole or a post.
- Hit any inanimate object.
It should be noted that unlike liability insurance, collision insurance isn’t a required component of auto insurance. Therefore, you should never assume that collision coverage is a default part of your insurance policy. Making such an assumption could lead you to experience a rather rude awakening if you are still making payments on a car that gets totaled.
The Basics of Collision Coverage
Because car accidents are the most common auto insurance claim, it should come as no surprise that collision coverage is the most expensive portion of your premium. The actual dollar amount of collision coverage is variable, and is based on several factors, including the car’s age, price value, ease of repair, and theft frequency. The other factor to think about when selecting collision insurance is setting the vehicle’s deductable. Much like other forms of insurance, a deductable is the amount of money you would be willing to pay in damages in the event of an accident before the insurance kicks in and picks up the rest of the tab. This also sets the cost of your premium; the lower your deductable, the higher your monthly payment. The trade off here is that you would have to pay fewer dollars in damages in the event of an accident.
While you may think that getting collision car insurance coverage is an automatic purchase, keep in mind that there are times where it may not be the best option. The most obvious one here is if you have a car that’s old. If a car’s age makes it essentially not worth salvaging in the event of an accident, then you could probably get away with not purchasing collision coverage.
Double Check to Make Sure
Because collision coverage can potentially be the most important part of auto insurance coverage, don’t be afraid to do a little research on the topic and talk to your insurance agent about the type of coverage you have. If you are unsure as to whether or not you have collision insurance, take the time to make sure one way or the other, and never assume. After all, that is what the top auto insurance companies are there for – to provide you with the type of coverage that you want. Therefore, take advantage of that notion. Whether or not such action makes you feel paranoid is entirely up to you.