It’s well-known that drivers are required by law to have liability insurance—motorists need to be able to cover the costs if they are at-fault for an accident with another driver. So you may be asking: what is collision coverage and why do I need it?
While not required by law to have, collision coverage is a very important coverage for any driver to have because it helps repair your own car in the case of an accident, regardless of whether you are at fault or not. In fact, collision insurance covers a wide variety of situations where our car could require significant repairs.
In short, any time your car is damaged in a collision with another vehicle, you can be covered by collision insurance. If you get in a major accident or a fender-bender, then collision insurance will contribute to the repair of your car. Even drivers who pride themselves on their safe driving would be well-advised to be covered in the case of a collision.
Collision insurance can cover damage that comes to your car when you are driving it and other non-vehicle accidents occur, like in the case of backing up into a pole or experiencing a rollover crash. Collision insurance can also be utilized if your car is parked and struck by another vehicle—even if it is a hit-and-run. It will not, however, cover your bodily injuries if your car is struck while parked and you are in it.
There are circumstances that collision insurance does not cover that are important to note. If your car is stolen (or someone attempts to steal it) and it is damaged in any way, your collision coverage will not cover it. Collision insurance will also not cover if your car is vandalized, nor if an “act-of-God” occurs, like a tree falls on your vehicle or you experience flood damage. It is most important to note that collision coverage does not cover any damage you cause to other vehicles or property, or to other drivers. That is covered by liability insurance.
This will depend on a number of factors, but ultimately it is a judgement call for you to make based off your budget and driving habits. If you live in a busy city and drive often, it may make sense to have a lower deductible because there’s a higher risk of accidents. Your best bet is to speak with your agent, research your options, and decide just what kind of collision coverage will work best for you.