Auto Collision insurance is an important coverage which every new automobile owner should possess. Auto collision insurance is important for various reasons. Some of them are listed below:
- In the case of collision, the driver in possession of collision insurance will be covered even when the other driver does not have liability insurance. This makes protection independent of the other driver involved.
- Auto collision not only covers for collision with other vehicles, but also provides coverage for any kind of collision.
- Repair and replacement of damaged automobile is completely taken care by the insurance company, and the individual needs to pay only the chosen deductible amount.
Auto collision insurance is required only if the automobile is new, or is well maintained. In the case of a very old vehicle, or vehicle in a poor condition, the insurance premium may exceed the total value of the vehicle itself. While filing a claim for auto collision insurance, the policy holders must be aware of the following:
- The insurance company decides whether the damaged parts need to be repaired or replaced.
- Insurance companies may try to replace the automobile parts with recycled or used parts. Insurance policy holders should make sure about any hidden conditions about replacements and the company’s policy about replacement with used parts. It is better not to sign the deal unless the company uses original auto parts with a guarantee.
- Some insurance companies do not release the money if the vehicle was faulty before the collision. For example if the auto owner had not replaced a faulty brake before collision and if the collision is a result of faulty brake, it would be difficult to get the claim.
- Policy holders must choose the deductible carefully, since insurance companies do not release the money unless deductible is paid in full. Having a greater deductible may result in more money being spent out of pocket, than obtained from the insurance company.
- To obtain coverage against other unforeseen circumstances like fire accidents, vandalisms, natural disasters, or protection against theft, comprehensive insurance must be purchased, which can be cost effective when combined with the auto collision insurance.
Auto collision insurance along with comprehensive insurance gives sufficient coverage to the automobile in case of a collision. If the individual lacks a good health insurance, it is always a good idea to purchase a personal injury policy along with auto collision insurance.
