What is collision coverage


Collision coverage helps to pay the costs of repairs or replacement of your car if it is damaged in an accident with another car or fixed object like a tree, fence or pole. It can also cover damage resulting from a rollover or pay if another driver crashes your car and you don’t have enough insurance to pay for the damage.

Collision coverage is like comprehensive, an optional coverage that you can add to your auto insurance policy at your discretion, if the car is already 100% yours. Rented or financed cars usually have these coverages as lender requirements.

What does collision coverage cover?

Collision coverage covers a number of traffic accidents, such as:

  • Accidents with other motor vehicles, including motorcycles, RVs, etc.
  • Hitting another object (street sign, telephone pole, hole, garage door, mailbox, house, tree, etc.)
  • rollover
  • Hit-and-run damage , including in parking lots.
  • Damage caused by an underinsured driver

If you are involved in an accident and another driver is fully at fault, his liability insurance must pay for the damage to your car. This coverage is mandatory in 49 of the 50 states, but still some do not have it. Assuming he has it, the claim is made for his insurance.

However, in many states the minimum limits are low and a driver with only minimum limits may not have enough coverage to pay for their car in which case their collision insurance would come into play.

What is Commercial Auto insurance and why should I have one?

This is one of the reasons why lenders require comprehensive and collision coverage.

What doesn’t cover?

Collision only covers damage to your car. This means you don’t pay for damage to someone else’s vehicle or property. Collision coverage also does not cover all damage to your vehicle, it DOES NOT cover:

  • Theft
  • Vandalism
  • floods
  • Fire
  • hit an animal
  • Falling trees/twigs and other objects
  • Hail
  • Damage to someone else’s vehicle
  • Medical bills (yours or someone else’s)

Some of these coverages are covered by comprehensive coverage, which complements your car care . Learn more about comprehensive coverage.

collision x comprehensive

Although it is common to confuse comprehensive coverage with collision coverage , they are very different, complementary, but different.

Comprehensive covers events beyond your control: theft, vandalism, fire and weather related incidents. Collision coverage protects against damage to your car caused by hitting another vehicle or object, regardless of who was at fault.

To clarify: neither coverage will cover medical expenses from an accident or damage to someone else’s vehicle if you have an accident.

Do I need collision coverage?

This coverage is only optional if the car is already 100% yours . If it is rented or is still financed, it is most likely that this requirement has been made, such is the damage that a crashed car can mean.

In addition to your home, your car is often your most valuable asset. How much can you shell out for it without planning? How would you go about fixing it if it was destroyed in an accident?

While collision coverage may increase the cost of your auto insurance policy, it protects the equity you have in your vehicle. Even if it’s not officially yours yet, collision coverage can help pay off everything you still owe.

Auto Insurance 101: All About US Auto Insurance

You need to consider the situations covered by the insurance and identify if they are risks that justify the cost added to your auto insurance policy. And if the amount disbursed is worth in relation to the value of the car.

When do I not need this coverage?

Assuming your car is paid, there are a few situations that justify not doing collision coverage :

  • Your car has a very low value:

If your car’s current value is too low, collision coverage can be unnecessary protection, especially if a large deductible is involved. For example, if your car is worth $1,500 and your deductible is $1,000, the most your insurer will pay in a collision claim is $500.

  • Your vehicle is not being used: 

If your car is stored or never used, collision coverage is not required. Comprehensive coverage protects against theft, vandalism, fire, broken glass and weather-related damage that can occur while the car is stationary.

  • Your car is covered by another policy: 

If your vehicle is listed on a family member’s policy, has collision coverage, and is kept overnight at the address you share with that family member, you may not need to add a collision to your own policy. Make sure you are also listed as a driver on that person’s policy and speak with your insurer or agent to ensure you and your car are properly protected.


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