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How Auto Collision Insurance Works


Auto insurance is more than about paying for neither the repair of damaged vehicles nor the replacement of the stolen ones. Auto insurance, essentially is about how company guarantors or brokers handle the provisions of their policy in relation to automobile owners and other concerned parties. 

Automobile insurers in the varied provisions of their policy cover liabilities of car owners—as well as their entitlements. For this, auto collision insurance is included.

Auto collision insurance is granted to car owners when their vehicles had been damaged due to crashing, smashing, hitting other cars or objects causing huge impact that result to destruction. In these instances, for which having been rear-ended by other cars is the most common, the automobile insurers or the companies pay for the repair or the replacement of the cars damaged or destroyed.

On the other hand, when a car owner with auto insurance crashes into another’s car or collides with an object on the road causing damage, the auto insurance company is also obliged to pay the party whose car was damaged by the person or party with auto insurance. If for example you have auto collision insurance and you accidentally rear-end another vehicle, your auto insurance company will pay for your liability by replacing or repairing the other person or party’s car.

Auto collision insurance then works both ways: for the owner of an automobile or vehicle and for the party who also share the same damages or destruction from collision. Many car owners believe then that auto collision insurance is not only beneficial once you have been caught in accidents causing damage to your car. For them, auto collision insurance is also in the best interest of car owners especially when payments of auto collision insurance are given out by companies to other car owners for an insured automobile possessor’s own liability (when an owner rear-ends another car, etc…).

Some criticisms about auto collision insurance, on the other hand, are that it is too costly that the benefits it offers may not be equal or more than what it demands. Other car owners cite that the fact that this auto collision insurance is not mandated by the law means that there is really no obligation whatsoever on a citizen’s part to avail especially when what he or she owns are old and inexpensive vehicles. Finally, criticisms point to abuse by auto insurance companies that require comprehensive coverage along with auto collision insurance.