Car crashes are great when they're in a movie. But in real life car accidents are anything but fun and exciting. Collision insurance is there to provide a cushion against a potentially disastrous wreck.
Here's a crash course in everything you need to know about collision insurance:
What is Collision Insurance?
This one's easy: Collision Insurance covers basically any type of collision you have with your car. This could be a collision with:
something natural, like a tree
something man-made, like a street lamp or building
With collision insurance, you can be absolutely, 100% responsible for the accident and the insurance company will still pay for repairs.
Well, within certain limits. Backed into your closed garage door. No problem. Taking a turn at 100mph only to slide into the side of your local grocery store? Breaking the law will usually void your policy.
As long as you were behaving in a legal way, however, you can be at fault for the damage and still be covered. Aside from the deductible.
What Type of Deductible Do I Need?
This is the initial payment for repairs. The higher the deductible you have, the lower your monthly premium payment. When shopping for car insurance, you'll want to find the right balance between your deductible and your monthly payment.
For instance, suppose someone plows into your car, which is parked outside your house. This causes $4000 worth of damage. Your deductible is $500.
So, you'd pay your $500 deductible and the insurance carrier would pick up the remaining $3,500.
Some Jerk Hit my Car! Is Collision Insurance Going to Cover the Damage?
According to the National Safety Council , the average adult will have about four car accidents each year. This isn't great news, obviously. But with collision insurance, your car might take a physical hit, but your wallet doesn't need to take a financial hit, too.
Aside from the immediate damage to your car, you'll also have to deal with the financial repercussions of missed work, possible medical rehab and other issues which may last for months after the actual accident occurred.
Collision coverage covers different types of accidents. Here's a look at some hypothetical ways some jerk could hit your car, and whether or not Collision Insurance is the right type of policy:
The Jerk Who Hit My Car was Uninsured!
You might be covered. Some collision policies cover an incident with an insured driver while others don't. This is a feature you'll want to check into before you commit to any policy purchase.
There's also a separate type of insurance you can buy called uninsured motorist coverage. In most cases, even if you successfully sue an uninsured driver, you're unlikely to collect any money. So uninsured motorist coverage can often be your best way to repair any damage.
The Jerk Who Hit My Car Then Drove Off!
Most types of collision insurance do cover hit-and-run damage. But there's a bit of a catch. If you file a claim, your driving report will show that a collision claim was paid.
If hit-and-runs are a reasonably common problem where you park, collision insurance might not be your best move. Instead, you'll want uninsured motorist coverage. And, to be honest, you might want a new place to park, too!
My Car is Old. Does It even Matter if Some Jerk Hits It?
There are a few types of cars where you should really consider collision insurance:
A car you're making payments on
A new car
A car you really, really don't want damaged
This last type of car can be an older, loved car. Here's the thing about old cars. If they're damaged and you need to pay for repairs, the cost of parts and labor is basically the same as a new car. Without collision insurance, you might be unable to afford full restoration, even if the car itself didn't have a great bluebook value.
Some Jerk Hit My Car! How Much is it Going to Cost Me?
The idea behind all car insurance is to pay small premiums in order to avoid a potentially larger repair cost one day in the future. But you need to find the right amount of coverage for your needs – and budget.
Your rates will be determined based on:
Your Driving Record. If you haven't filed a claim in at least three years, you're likely eligible for a Good Driver Discount.
Your Age. Younger drivers are considered riskier, but those premiums can be lower by successfully completing a Student Driver course.
Your Mileage. If you drive limited miles or within a relatively small area around town, you're considered a much lower risk to insure than someone who drives all over the place.
Your Grades. High school and college students can earn bonuses for maintaining a high GPA.
How to Shop for Collision Insurance
Collision Insurance isn't required by any state law. But it's still very popular. This means there's a lot of competition out there, and you as a customer can benefit.
Insurance professionals at Chimp Quote make it possible to see the best collision insurance price quotes from hundreds of top insurance companies in seconds.
There are many discounts available, and unless you're familiar with the insurance industry, you might miss out on all the ones you deserve. This is another way insurance professionals like Chimp Quote can help.
Do You Need Collision Insurance?
Collision Insurance isn't legally required in most states. You can save some money each month by skipping collision coverage.
But you're unlikely to save money in the long run. Unfortunately, a collision between a car and, well, just about anything else will usually result in damage to the car. Collision repair is often expensive. You'll want collision coverage in order to get back on the road quickly.
And that's a movie which has a happy ending.