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The Importance of Auto Collision Insurance


Not even the sharpest psychic can foretell when an accident will happen. One thing is for sure, though, accidents do happen and will keep on happening. If you have been driving a vehicle on the streets for a considerable amount of time, chances are you have been in a minor or major vehicular accident. That drives home the point of getting insurance.

The term collision auto insurance is pretty self-explanatory. It is insurance for a vehicle to cover damage payments in case it collides with another vehicle, a structure, a person, or an animal. If you smash into the side of another vehicle, your liability coverage will take care of payment for damages caused to the vehicle you hit.

Your car is covered by collision coverage minus the deductible. Deductibles are generally available in increments of $250, and may increase to more than $1000. Higher deductibles mean cheaper insurance policies.

Liability coverage is required by law. Collision insurance, on the other hand, is not a legal requirement but the risks are great if you do not purchase collision insurance. If you do not have it and you happen to bump into another vehicle, you will have to pay for repairs or getting a new vehicle for yourself--all these without any help from your insurance company.

There are some car owners who opt not to buy collision coverage because it can cost a lot of money. They may also decide that it is not worth it for their older and cheaper cars. However, if you got your car through financing, your lien holder could compel you to get collision and comprehensive coverage.

There are many reasons why every vehicle owner should get insured.

Collision insurance may not be a prerequisite by law, but most other vehicle insurance policies are. If you are caught without auto insurance, you could pay a heavy fine, lose your license, or even spend time in jail. If you smash into another vehicle and do not have collision insurance, you will be forced to pay for repairs or even buy another vehicle. It could get worse if your actions caused severe injuries or death to a person. This could be a clear scenario for bankruptcy.

You must also have insurance as protection for your investment on your car. If you got a loan to buy your car, the bank or lending firm expects you to maintain payments.