Saturday, February 7, 2009

What is Collision Auto Insurance?

By Amy Nutt

Collision insurance is designed to pay for the repair of damages to your car in the event of an accident that you caused. Collision car insurance isn't a necessity to have your car on the road if you are the owner, but it may be a good idea if you spend a lot of time behind the wheel.

Who Needs Collision Insurance?

Many of the drivers on the road today aren't yet the official owners of the vehicles that they are behind the wheel of. Cars, even many used cars, are expensive - very few people have the eight, ten or twenty some thousand dollars lying around to pay for their vehicle in full so they have to take out an auto loan to make the purchase. Odds are, that if you are going to be paying for your car with an auto loan, that your bank will require that you have collision insurance to pay for it should you get in an accident.

Who Should Have Collision Insurance?

If you've paid off your car loan, or where able to buy your car outright, then having collision coverage for your car is purely optional. Despite the fact that having collision insurance on a car you own isn't necessary to operate your vehicle, it does make sense for some drivers to pay the expense for the protection.

People who travel a good bit for their jobs, like outside sales people or district and regional managers or people who have an exceedingly long commute may profit from the protection of collision insurance. The longer and more often you are on the road, the better your chances are of becoming involved in an accident; if you happen to be the one that causes the accident, collision insurance will pay for the repair or replacement of your car.

People who own automobiles that will be driven by young or inexperienced drivers can also benefit from collision insurance coverage. Inexperienced drivers can make mistakes and they aren't always prepared for everything that heavy traffic on the road can throw at them. You have enough to worry about when your children become old enough to get behind the wheel, having to pay for a car that gets damaged doesn't have to be among this new set of worries if you opt for collision coverage.

How Collision Insurance Works

Some confusion can occur due to the names of the types of coverage available; collision coverage doesn't necessarily pay for any automobile damage that occurs as a result of an accident. If an accident you're involved in is the fault of another driver, that driver's liability insurance, which is a required form of coverage, will pay for the damages to your vehicle. Collision insurance will pay for the damages to your car when you are at fault or are the cause of the accident.

There are different auto insurance options available to a driver who wants protection in the form of collision coverage. You can opt to pay a higher out of pocket deductible in the event that something happens in order to keep your monthly output at a minimum, or you can choose to pay a higher monthly premium in order to have as little out of pocket expense as possible should you be the cause of an accident.

You never know when an accident is going to occur, that's why they are called accidents. A momentary lapse in judgement or loss of concentration while on the road can cause tremendous damage to your vehicle, if you have collision coverage on your vehicle you will be protected form having to pay for the damages, even if your car is "totaled." That piece of mind alone is enough to merit the expense for some drivers.

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