What Is Collision Coverage?
Collision coverage pays to repair or replace your car when it's damaged in an accident with another vehicle or object, regardless of who was at fault.
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What Is Collision Coverage Insurance?
Collision coverage pays for damage to your car when you hit another vehicle, are hit by another vehicle, or strike an object like a guardrail, fence, or pole. It covers your repair costs up to your car's actual cash value (what it's worth at the time of the accident, not what you paid for it) minus your deductible (the amount you pay before insurance kicks in). This coverage applies regardless of who caused the accident — even if you were at fault and your liability insurance is already paying for the other driver's damages. If your car is totaled (costs more to repair than it's worth), collision coverage pays the actual cash value minus your deductible, and the insurance company takes the vehicle.
Who Needs Collision Coverage Insurance?
First-time drivers and those under 25 should strongly consider it despite the higher cost, because your accident risk is statistically higher and you're more likely to be hit by an uninsured driver in your age group. Even if you're a careful driver, collision coverage protects you from other people's mistakes and from situations where the at-fault driver can't pay.
Use this rule: if your car's actual cash value is less than 10 times your annual collision premium, consider dropping the coverage and saving that money instead.
How Much Does Collision Coverage Insurance Cost?
- Your age and driving experience — drivers under 25 pay substantially more because collision claim rates are highest in this age group, with inexperience being the primary factor insurers price for.
- Your car's safety and theft ratings — vehicles with high safety scores and low theft rates cost less to insure for collision because they're statistically less likely to be in serious accidents.
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