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Collision Car insurance – What You Need to Know

Collision insurance is a great coverage one should have on their auto insurance policy. If you are ever in a situation where your vehicle has been damaged with an object or another car, you’ll be covered. Read on to find out more information and how this insurance policy will help you.

With most insurance companies purchasing this type of insurance coverage is an optional policy that you can purchase for your vehicle. Most of the time this insurance policy is paired with comprehensive insurance coverage. Having both comprehensive insurance and collision insurance your vehicle will be adequately covered in most scenarios during an insurance claim.

There are a few scenarios where you are required to take collision insurance as a policy. For instance, if you are leasing or financing your vehicle, your lender may require that you have collision and comprehensive insurance on your vehicle before you are eligible to take it off the lot.

Before you can get going, you will need to know exactly what collision insurance covers you for and how it benefits you during an accident claim.

When purchasing your vehicle you will be posed with a question regarding your insurance coverages. If you are leasing or financing your car you more than likely would be asked to insure the car under many different policies by your lender so the vehicle is protected throughout the duration of lease or finance. If you choose not to purchase the insurance your lender would add the instalments into your monthly payment since they would purchase the insurance for you, this is called forced placed insurance. Because it is an optional policy does not mean you should overlook. If your vehicle has been in an accident you may need this coverage to help cover your insurance bills, like any other this does require a deductible.

What Collision Car Insurance Covers

If there has been an incident when your vehicle if it has been damaged in an accident involving another vehicle or damaged in general. If your vehicle has been damaged in an accident, collision insurance would be a policy that would have your vehicle repaired. Your insurance company would be able to pay for the damages on your vehicle given that it not deemed a total loss. Total loss occurs when the damage of the vehicle is worth more than the actual cash value.

If you are a new drive or have younger drivers in the household this insurance policy would be a great asset. Not only does it brings peace of mind but also can help you with the costly repair bills that can come about from an accident or insurance claim. Of course, this does not exclude any experience drivers. Anything can happen on the road that can cause an accident or any damage to your vehicle.

  • Car accident
  • Sliding on Black Ice
  • Skidding in Snow
  • Understeer
  • Oversteer
  • Flipping the car/Rolling Over

Collision insurance is a great asset to anyone who is driving on the road. Even though you are paying a higher premium compared to if you didn’t have it. This insurance coverage carries its benefits when the time is right.

Here is an Example

You live in the state of Florida and your wife finally gives you the thumbs up to lease the car of your dreams, the BMW M3. You’re excited and can’t wait to get behind the wheel to test this bad boy out.

The company you are leasing the vehicle from asks if you had done some searching in regards to your insurance policy, specifically collision car insurance. You were quoted an estimate of $2000 per year for your insurance policy. You decline the offer and choose not to add the insurance to your new M3. When completing the payment for your BMW, the company has decided to opt into the insurance for your vehicle and it turns out to be a total of $5000, $3000 more than your own insurance company.