Auto insurance comes with a lot of terms and conditions. It is all about the coverage that matters when one takes an auto insurance.

What is a collision coverage?
A collision coverage can be termed as a coverage that you get when your car collides with another vehicle or an object such as a tree, wall, or fence. All insurance companies provide collision coverage. When your vehicle is collision insured, your insurance company is required to pay for any repairs or replacement, if the car is involved in an accident.

In the event of leasing or financing a car, this insurance is provided by the lender itself. Having a collision coverage is worth your peace of mind if any untoward event happens with your vehicle.

Coverages under collision insurance
Collision insurance will only be covered if, your car has collided with another vehicle. Apart from another vehicle, it can even be an object such as a tree or a fence. Lastly, it should involve a single car, rolling or falling over.

Things not included under collision coverage include any damage that is unrelated to driving and any medical expenses incurred due to the damage. This is regardless of your or another person’s fault and it also does not include coverage for damage caused to another vehicle.

When do you need a collision coverage?
People who own an expensive car or have expensive repair work will need a collision coverage for their vehicle. It is more importantly needed for newer vehicles. Having a collision coverage for your vehicle is strictly optional. This is why old car owners do not require this coverage. The cost of coverage might outrun the total value of an old car, not to forget the repairs!

How much does collision coverage cost?
When it comes to the cost, there are many factors that determine the insurance cost. For instance, if the vehicle is old and the driver has a history of accidental damages, then most likely the insurance will be higher since he is more likely to use the insurance. Apart from that, factors like type of vehicle, miles driven, gender, the age of the person driving the vehicle, driving history, and the current value of the vehicle will decide the cost of collision insurance.

Collision coverage and deductibles
Collision coverage comes with a deductible wherein you can claim for the amount that you have paid for your coverage. Depending on the amount of deductible chosen, the insured has to pay that amount toward repairing cost in the event of any damage leaving the rest expenses to be covered by the insurance company. Whatever is your coverage limit, is the actual cost of your vehicle.

For instance, if the vehicle is totally destroyed beyond repairing cost, or totaled, in that case, your insurance company pays the depreciated value while subtracting the deductible based on the estimate given by the estimator.

How much amount would you want to spend on collision coverage, is totally dependent on how old your car is and how much repairs you can afford. Collision coverage makes sense if you, as an owner feel that repairing a car after any damage can cost you a fortune.