There are many drivers who take insurance only because it is mandatory. You need to have liability insurance in order to take care of the other party’s damages if you are the driver at fault. However, there are a lot of benefits for having auto collision insurance that pays off in the long run.
When no driver is at fault
A lot of times there is an accident and neither driver can really be held responsible. In other words, the accident was unavoidable. In such a scenario, your auto collision insurance will take care of all the damages to your car. Restoring your car back to full can be expensive, it is best to have auto collision insurance in order to take care of the repair damages that can be costly.
When you don’t know about the guilty party
Many times, your car is parked on the street and it is damaged by another driver’s carelessness. Since you cannot be sure who it was, you will have to incur the costs yourself. In this case, your auto collision insurance will take care of the damages.
When you are the driver at fault
When you are responsible for an auto accident, your liability insurance will take care of the other driver’s personal injuries. You will also need to have auto collision insurance for damages to your own vehicle which could be expensive. Furthermore, if your vehicle is expensive, it is very imperative that you have auto collision insurance to cover your vehicle in case of an accident.
Car replacement or cash value
One of the biggest benefits of auto collision insurance is that you can get car replacement value or cash value for your car in case of irreparable damages. Car replacement insurance is very helpful because the insurance coverage will be provided for a replacement car, which is based on the condition of your damaged car, the mileage and the kind of security systems that have been installed in it etc. In most cases car replacement insurance coverage is always far more than the cash value which is not sufficient to buy a new car. If your auto loan has a balance, your vehicle would paid off in full.
