There are several coverages that an auto insurance policy provides, out of which some are mandated by law, while some are optional. Collision coverage is one of them.
There are different types of auto insurance offered by companies, which you can choose from. But then, which one to apply for depends on you. You should consider the coverage in detail and then make the decision. You need to consider the things you want to protect, whether it’s you, your family, or you want the vehicle to be covered, as well. The two most important auto insurance types offered by companies include collision and comprehensive coverage.
Difference Between Collision and Comprehensive Insurance
There are several people who do not go for car insurance voluntarily, but only because it is required by law. This is the reason why they pay very little in premiums, especially for their vehicles. However, there are other people who prefer to protect themselves and their car from damage, and so, they combine both collision and comprehensive coverage together to protect their vehicles from different unknown situations.
Collision coverage is the protection provided to your vehicle against damage due to accidents, hitting an object, or overturning. If your car meets such a situation, the company pays for repairing it. The main advantage of it is that it protects the driver, irrespective of whether he/she is at fault. Moreover, there are provisions for salvaging the car to its original form, in case it has been badly damaged. In addition, it covers the cost of repairing or replacing parts of the vehicle. However, it does not cover mechanical failure, due to improper maintenance.
On the other hand, comprehensive coverage protects your vehicle from theft, riots, weather damage, vandalism, fire, etc. However, it does not cover protection against damages to the parts of the vehicle due to an accident, or as a result of improper maintenance.
Buying Collision Insurance
One of the most important features of this coverage is that, in case you are responsible for causing injury or death of another person in an accident, the respective company pays compensation for it. Moreover, it provides a legal defense in case the other party files a lawsuit against you. It covers you and pays the injured party, without requiring you to pay anything. It also covers claims for bodily injury, which may include medical bills, pain and suffering, and loss of income.
There may be times when you may think that the accident has been caused due to the fault of the other person and not you, but the other person may disagree. If this is the case, both of you would be entangled in a lengthy legal duel. However, if you go for this coverage, the company would take the responsibility of repairing the car, besides taking over the claim, which you may have made against the other person.
Moreover, there may be times when the other driver may not have liability insurance, and in such a case, filing a lawsuit may not be of any benefit. However, in this scenario, a collision coverage would pay for the costs of repairing the vehicle.
The amount of coverage and the premium you have to pay depend on the type of your car and its value. In case your car is expensive and prone to damage, the premiums would be on the higher side. However, if it scores well for durability and safety, they would be less. Regardless of your decision in relation to availing it, make sure that you go through the fine print, to understand what you are paying for.