Collision insurance covers the cost of repairing your car after an accident you cause. If you’re the owner of your vehicle, collision insurance is not necessary. However, it can be beneficial if you spend a lot time behind the wheel.
Who needs collision insurance?
Many drivers today don’t have the title of official owner of the cars they drive. Even used cars are costly. Very few people have enough money to purchase a vehicle in full. This is why they need to get an auto loan. Your bank may require you to have collision insurance if you plan to finance your vehicle with an auto loan.
Who should have collision insurance?
Collision coverage is only available to those who have paid off their car loans or are able to purchase their car directly. Although collision insurance is not required to drive your car, some drivers find it beneficial to have the coverage.
Collision insurance is a benefit for those who travel extensively for work, such as district and regional managers, outside salespeople or district and region managers. Also, people who commute a lot may be able to benefit from collision insurance. Your chances of being involved in an accident are higher the longer you travel. Collision insurance will cover the cost of the repair or replacement of your vehicle if you cause it.
Collision insurance coverage is also available for those who own cars that are likely to be driven by inexperienced or young drivers. Inexperienced drivers are more likely to make mistakes than experienced drivers and may not be prepared for the rigors of heavy traffic. If you choose collision coverage, your worries about the car being damaged or stolen will be less than those of you who have children.
How Collision insurance works
There can be confusion due to the names and coverage options. Collision coverage does not necessarily cover any automobile damage caused by an accident. Your vehicle’s damages will be covered if the accident that you are involved in is caused by another driver. This is called liability insurance. If you are responsible for an accident, collision insurance will cover the damage to your vehicle.
Drivers who want collision coverage have many options. To keep your monthly outlay as low as possible in the event of an accident, you have the option to choose to pay a higher deductible or a monthly premium to cover the cost of any injuries.
Accidents can happen at any time, and you never know what they will bring about. You can inflict severe damage to your vehicle by a momentary error or loss of focus while driving. If you have collision coverage, you won’t be responsible for any damages to your vehicle even if it is “totaled”. This piece of mind is enough to justify the cost for some drivers.