What Is Collision Coverage for Auto Insurance?

Fran Majidi
July 26, 2019

Collision insurance pays for damages and loss caused by impact with another automobile, object or person. It is subject to a deductible of your choosing. Like comprehensive coverage, the higher the deductible, the lower your premiums and vice versa. It, too, is not required by law but is usually required if you lease or finance a vehicle.

If you have a collision with another moving vehicle and it was your fault, your liability insurance covers the other driver, that driver’s vehicle and passengers while your collision coverage will cover you, your vehicle and your passengers. The same goes for hitting a parked car, utility pole or street sign. Your collision takes care of you.

Liability insurance will never take care of damages to you or your vehicle and passengers. It’s intended to cover your liability for harming the other party in terms of losses. 

Just as with comprehensive insurance, you can choose a deductible for your collision coverage. The deductible usually ranges between $250 and $1,000 for each accident. Keep in mind that your collision insurance will not pay out for damages until you have paid the deductible amount towards your losses first. Choose a deductible that you’ll be able to afford.

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