What Is Collision Insurance?

Even the safest drivers on the road can find themselves in a fender bender or other accident. If that happens, it's critical to have the right protection for your vehicle. That means having collision insurance.

Luckily, an independent insurance agent can help you get equipped with the right collision insurance long before an accident ever occurs. They'll make sure you have all the auto insurance you need. But first, here's a deep dive into collision insurance and what it covers.

The meaning of collision insurance is coverage that pays for damage to your car from a collision with another object, regardless of fault. Collision insurance is one component of a full car insurance policy that covers the cost of repairs if your car collides with another vehicle or object like a telephone pole, guardrail, pothole, or mailbox.

Collision insurance covers most types of collisions, except for those with large animals like deer. To cover that kind of collision, you'd need comprehensive insurance.

Collision insurance isn't one of the types of car insurance typically required by state law. But it's still an important coverage to have to protect your vehicle from potentially costly repairs, and it's often a component of full coverage car insurance.

Without collision coverage, you could end up paying out of your own pocket for damage to your vehicle after an accident. Whether you're involved in an at-fault accident, get hit by an underinsured driver, or are the victim of a hit-and-run, collision insurance can reimburse you for costly physical damage to your car.

What Does Collision Insurance Cover?

As the name suggests, it covers costs related to collisions with other motorists' vehicles or objects like posts and fences. Collision insurance helps you pay for vehicle repairs or a replacement, and if you’re leasing your car or still paying it off, it also helps cover any debt if your vehicle gets totaled. Here's a breakdown of what collision insurance covers and doesn't cover.

What's Covered by Collision Insurance?

Covered:	Not Covered:
Traffic collisions with other cars	"Other than collision" threats like vehicle theft, storm damage, etc.
Collisions with objects like telephone poles and fences	Costs of repairs to another driver's vehicle after a collision
Collisions with potholes and other road obstructions	Collisions with large animals like deer
Certain accidents like rolling your car into a ditch	Personal injury costs or medical payments

While collision insurance can help pay to replace your car if it gets totaled in an accident, keep in mind that your coverage comes with certain limits. Often, collision insurance will only pay for your car's actual cash value, which factors in depreciation. To make up for the difference in what you might owe your lender on a car loan, consider getting gap insurance.

Do I Need Collision Insurance?

Though you typically don't need collision insurance by state law, going without a vehicle after an accident can really disrupt your daily life. Having collision insurance limits the time you’ll spend carless after an accident. However, having collision insurance doesn't always make sense for everyone.

You might not want collision insurance if:

You drive a car with a replacement cost that would be cheaper than your annual premiums.
You have enough disposable income that you could easily pay out of pocket in an accident.

If you don't fall into either of these two categories, though, collision insurance is highly recommended. Without collision coverage, you would need to pay out of pocket for any collision damages to your car. Your independent insurance agent can help you determine if collision insurance is a good fit for you.

Is Collision Insurance Required by Law?

Collision coverage is one type of car insurance that's not required by state law. Most states require property damage liability and/or bodily injury liability insurance as their minimums, while others might require uninsured/underinsured motorist coverage or personal injury protection coverage.

However, car dealerships and banks often require you to have collision insurance if you lease or are otherwise still paying off your car. Understanding the difference between collision and comprehensive insurance is also important.

Another important coverage not required by law is comprehensive, or other than collision, coverage. Along with collision insurance, these are both critical coverages to consider.

Comprehensive insurance: Pays for damage to your car due to a non-collision event such as a flood or theft.
Collision insurance: Pays for damage to your car from a collision with another object, regardless of fault.

An independent insurance agent can explain even further why it's imperative to consider adding collision and comprehensive coverage to your car insurance policy.

Why Consider Adding Comprehensive Insurance?

To complete your car insurance policy, you might want to consider adding comprehensive coverage in addition to collision insurance. That's because comprehensive insurance can pay for additional threats that can damage your vehicle other than collisions, including floods, vandalism, theft, hail, break-ins, and much more. Without comprehensive insurance, you might not have coverage to pay to repair your vehicle's physical damage if you weren't involved in a collision.

How Does Liability Insurance Differ from Comprehensive or Collision Insurance?

If you've heard the term "full coverage" car insurance, though it's not a standard policy, it often means a combination of collision insurance, comprehensive insurance, and liability insurance. There are two major forms of liability coverage under car insurance:

Bodily injury liability: Pays for injuries to another driver and their passengers if you cause an accident.
Property damage liability: Pays for damage to a third party's property if you hit it with your vehicle.

While collision and comprehensive coverage are meant to cover damage and destruction to your own vehicle, liability coverage is meant to protect others, including other drivers, pedestrians, etc. It can also cover your defense costs if you are sued for damages.

How Much Does Collision Insurance Cost?

Collision insurance is just one part of a complete car insurance package. The average cost of collision insurance is $382 per year. However, the cost of your overall car insurance policy can depend on several factors, including:

Your vehicle's make and model
Your vehicle's age and value
Your location
Your driving history
Your credit score
Your age and gender

Not all states allow car insurance rates to be based on some of these factors, including gender and credit score. Also, keep in mind that your car insurance policy comes with various deductibles, and you'll have to pay these amounts out of pocket before you receive any reimbursement from your coverage after filing a claim.

An independent insurance agent can help you find exact quotes for car insurance in your area. Depending on your situation, you may also qualify for some car insurance discounts.

Why Choose an Independent Insurance Agent?

Independent insurance agents have access to multiple car insurance companies, so they're free to shop and compare policies and rates for you. Ultimately, they can get you matched to the policy that offers the best blend of coverage and cost. And down the road, your agent will still be there to help file car insurance claims for you or update your coverage as necessary.

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