Auto Collision Insurance Will Protect You If You Are Responsible for an Accident

When you obtain vehicle insurance for your car, you are required by law to get liability insurance. Liability insurance will cover you for any damages that you incur to another vehicle or person in an accident. However, auto collision insurance is another important type of insurance that you may want to consider for your vehicle.

Collision insurance for your vehicle is optional insurance coverage, and when you choose this type of insurance, you will be covered for any damage that is done to your vehicle when you are at fault in an accident. With standard liability insurance, you have no protection if you incur any damage to your own vehicle when you are responsible for the accident.

While you are not required in any state to obtain auto collision insurance for your vehicle, some lenders or dealers may require it. For example, if you are leasing your vehicle, the automotive dealership may insist upon collision insurance as part of the lease agreement. Often, financial lenders will also insist upon this insurance to protect their investment as well.

When you have collision coverage, you will have to choose a deductible limit. The deductible limit is the amount of monetary damage incurred before the insurance starts to kick in. For example, if you have a deductible limit of $500 and your car suffers $750 worth of damage, the insurance company will only cover you for $250. The higher the deductible amount is, the less your insurance premiums will be. However, when you choose your deductible limit, keep in mind that if you have an accident, you may need to come up with the cash in order to make repairs not covered because of that deductible.