When you start looking at different types of auto insurance coverages, you might feel confused and uncertain about the types you need. One type you can purchase is called collision coverage, and this is a very popular type of car insurance. If you are not sure what exactly this type is, here are several things you should know about it.
It provides coverage for your car when you cause an accident
The main thing collision coverage provides is coverage for your own vehicle if you wreck it. For example, if you rear-end another car while driving, it is your collision coverage that will pay to have your car repaired. Without collision coverage, you would be responsible to pay for the repairs your own vehicle needs.
One important thing to understand about collision coverage is that it only provides coverage for the actual value of your car. For example, if you total your car and it is worth $10,000, collision coverage will only pay the $10,000. If you owe $12,000 on the car, you would have to pay the remaining $2,000 out of your pocket. If you want to make sure you do not have to pay money out of your pocket if you total your car, ask your agent about getting gap coverage.
It is required for people with loans
Secondly, if you have a car loan on the vehicle you own, you will be required to purchase collision coverage. Lenders have this requirement for their protection, and your lender will purchase coverage for you if you do not buy a policy. If you do not owe money on a car lender, you do not have to purchase collision coverage; however, you should consider purchasing it anyhow, simply because it will provide protection for you and your vehicle.
It does not cover certain types of damage
While collision coverage is very important and helpful if you cause an accident, there are things that it will not cover. It will not cover damage from vandalism or storms, and it does not provide coverage for damages to other cars involved in the collision you caused. You can purchase other types of coverage that will protect you in these types of situations.
Having collision coverage is often a good idea, but it is not something you have to buy if you own your car outright. If you are not sure if you should purchase collision coverage, ask an insurance agent for advice.
For more information, contact insurance companies like Phillip R Davis Insurance.
My name is Krista McMullin and this is a blog about home insurance. Life is full of uncertainties, but it doesn't have to be. For every uncertainty, there is often a form of insurance that can be used to help you feel less nervous. However, some of these forms of insurance may be unnecessary. How do you know exactly what form of insurance you really need? I always wondered this and I have spent a lot of time studying home insurance policies and various situations in order to come up with the perfect home insurance policies for each individual. I hope my blog is helpful to you.