Collision coverage helps pay to repair or replace your vehicle if it's damaged in an accident with another vehicle or stationary object like a tree, guardrail, or fence. It can also cover damage resulting from a single-car accident, such as a rollover. Note that collision is a specific coverage on your policy, not a type of insurance, and is usually required if you lease or finance your car.
What does “collision insurance” cover?
Collision covers a range of driving mishaps, such as:
- Accidents with other motor vehicles, including motorcycles, RVs, etc.
- Hitting another object (guardrail, street sign, phone pole, pothole, garage, mailbox, house, tree, etc.)
- Overturning your vehicle
- Damage from a hit-and-run accident (including parking lots)
- Injuries to pets riding in your car, up to $1,000 (comes standard with Progressive’s Collision coverage; not all insurers will cover pet injuries)
Is collision insurance worth it?
Besides your home, your vehicle is often your most valuable possession. You wouldn't pass on home insurance, so why risk it when it comes to your car? Without collision coverage, you could be out thousands of dollars if your car is damaged or totaled in an accident.
While collision coverage will increase the cost of your auto policy, it protects the equity you have in your vehicle. Even if you have no equity in your car, collision coverage can help pay off whatever you owe on the vehicle. That’s why nearly all lenders will require you to add collision coverage to your policy if you lease or finance your car.
When should you pass on collision coverage?
Assuming your car is paid off, there are only a handful of situations that justify eliminating collision coverage:
Your car has minimal value: If the actual cash value of your vehicle is less than a few thousand dollars, carrying collision on your policy may be an unnecessary safeguard—especially if a large deductible is involved. For instance, if your car is worth $1500 and your deductible is $1000, the most your insurer will pay out on a collision claim is $500.
Your vehicle is off the road: If your car is in storage or never driven, collision coverage isn’t necessary. Comprehensive coverage protects against theft, vandalism, fire, glass breakage, and weather-related damage that could occur while your car is stationary.
Your car is covered on another policy: If your vehicle is listed on a family member’s policy, has collision coverage, and is kept overnight at the address you share with that family member, you may not need to add collision to your own policy. Be sure you’re also listed as a driver on that person’s policy, and talk to your insurer or agent to ensure you and your car are properly protected.
Do I need collision coverage on an old car?
The age of your vehicle isn’t as important as its value when deciding on collision coverage. If your old vehicle is paid off, but well-maintained and low in mileage, it likely carries enough value to warrant collision coverage.
Regardless of your car’s age or value, if you don’t have the funds to immediately buy a new ride if your car is totaled or you’re unable to afford repairs from an accident, you may want to think twice about dropping collision coverage. And if you do decide to drop it, make sure to put the money you save into an account for emergency car repairs or for a new vehicle, if necessary.
What’s the difference between comprehensive and collision insurance?
Comprehensive covers events out of your control: theft, vandalism, hitting an animal, glass breakage, fire, and weather-related incidents. Collision coverage protects against damage to your car from hitting another vehicle or object, regardless of fault. Some insurers, including Progressive, require you to carry comprehensive if you purchase collision, however you may carry comprehensive coverage separately.
Common questions about collision coverage
How much does collision coverage cost?
At Progressive, collision costs around $61/month on average.Disclaimer Your prices for adding collision will vary based on factors including your age, driving history, and the make and model of your vehicle.
Will my collision coverage carry over to a rental car?
Yes, if you rent a vehicle, it will be insured exactly as if you were driving your own car.
What if the accident isn’t my fault?
If another driver hits your car and they’re deemed at-fault, their insurance company should pay for your vehicle’s repairs. If the at-fault driver has no insurance or is underinsured and you don’t carry uninsured motorist property damage, your collision coverage can pay to repair or replace your vehicle.
What deductible should I choose?
Select a deductible you can afford to pay. While a higher deductible will lower your premium, the savings may not be worth what you’ll have to pay out of pocket in the event of a collision claim. When deciding on a deductible, consider the value of your car, and how much you're willing to pay out of pocket.
If my car is totaled, will collision pay off my car loan or lease?
Auto collision insurance will pay you the fair market value of your vehicle. If that isn’t enough to satisfy what you owe on your car loan, gap coverage can help pay the remaining balance.
Call our licensed insurance agents today to discuss what's best for you and your situation.
Source: https://www.progressive.com/answers/collision-insurance/