What does collision insurance on a car cover?

Collision insurance covers your vehicle if it's damaged in an accident. Collision insurance rates will add an average of $50/mo to your premiums.

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UPDATED: Jun 2, 2022

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Written By: Laura BerryReviewed By: Joel OhmanUPDATED: Jun 2, 2022Fact Checked

Here's what you need to know...

  • Collision insurance may help pay for the cost of repairs to your car when it is physically damaged in an accident
  • In the event of a hit and run accident, collision coverage can help you cover the cost to repair your car
  • Collision coverage is not required under state law for mandatory car insurance, but it is recommended because state minimum coverage may not be enough for you to recover fully from a car accident

Collision insurance is an important coverage to have to recover from any physical damage to your car as a result of a collision.

Even though collision coverage is technically an optional coverage under your car insurance policy, it is recommended for many drivers to cover the cost of repair to your car that typically exceeds state minimum coverage.

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What is collision insurance for your car?


Collision insurance is considered optional insurance coverage as part of a standard auto insurance policy.

Basically, if you have collision coverage, you can get reimbursed for the cost of repair to your car after it has been damaged from colliding with another object, hitting another car, or flipping or rolling over.

Collision insurance is different from standard liability coverage because collision coverage only covers property damage from your vehicle striking another object.

One of the reasons that collision coverage is such a beneficial supplemental insurance coverage is that you can use collision coverage to cover the damage to your vehicle even if you get into an accident that is totally your fault.

This distinction is important from a standard auto insurance policy, which will only cover damages to the other driver’s car or truck if you are the cause of an accident.

If you do not have sufficient personal assets to be able to cover the costs of repair to your car in an accident that is your fault, then auto collision coverage can be a lifesaver.

One way to reduce the monthly cost of collision insurance is to increase the deductible, which means you will have to pay some amount out of pocket if you need to have your car repaired after an accident.

When you are searching for the best insurance policy for you, be sure to take into account the cost and coverage available from collision insurance so that you are protecting your assets.

Even though collision coverage may increase the cost of your monthly premium, it is worth looking into this additional coverage regardless of whether you only have to rely on this coverage one time.

According to the National Association of Insurance Commissioners (NAIC), an estimated 72 percent of insured drivers also purchase collision coverage along with the required liability coverage to meet state minimums.

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What is not covered by collision insurance?

Because collision insurance covers physical damage to your vehicle as a result of a collision, it does not cover any injuries to people.

While all policies vary, it is important to note that collision coverage typically does not cover the cost of repairing any damage to your car from car theft, flooding, vandalism or falling objects hitting your car.

For example, if a tree were to fall and hit your parked car, this would probably not be covered by collision insurance. Many of these incidents would be covered by another type of auto insurance called comprehensive coverage.

Just like collision coverage, comprehensive insurance is an optional part of a standard auto insurance policy and is not part of any state requirement for car insurance coverage.

When searching for an auto insurance policy that best meets your needs, you may want to consider the benefit of adding comprehensive coverage and comparing the relative price increases.

For the amount of coverage you may be gaining, the price increase could potentially be negligible.

How much will collision coverage pay for damage to my car?


The basic answer for how much you can recover from your auto collision coverage is that the insurance company will pay for damages up to and including the limits of your policy.

If there is damage to your car in an accident that will cost more than your policy limits to repair, you may be responsible for paying those costs yourself.

If you are involved in an accident where the other driver is at fault and only has the state minimum coverage for liability insurance, then your own auto collision coverage may cover the remaining costs of repairs for your car.

For example, if the total damage to your car caused by the other driver in the accident was $30,000, and his policy only covers $25,000 of that, you would be responsible for paying the remaining $5,000 for repairs.

Collision coverage would come into play to pick up the rest of the car repair bill.

On the other hand, if you crash your car into a tree as a result of your own negligence and cause $30,000 damage to your car, you could use your auto collision coverage to help with the repair cost.

If your auto collision insurance policy limits are $25,000, then you would have to go out of pocket to cover the remaining $5,000 of the car repair bill.

In deciding how much collision coverage is right for you and your family, you need to take into account the value of your vehicle and how much you would be personally willing to pay out of your own pocket for a car repair.

Choosing the right amount of coverage for collision is just as critical as getting a great rate on your policy.

Whether or not you choose to supplement your standard auto insurance with collision coverage depends on whether you can financially cover any damage to your car in a collision that is your fault or that the other responsible driver cannot pay for.

Although collision coverage is not required under state law, it is a prudent choice for any driver who may not be able to cover an entire car repair bill after a serious collision.

Get several quotes for collision coverage before making your choice. Enter your zip code below to get started!

Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Written by Laura Berry
Former Insurance Agent Laura Berry

Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP® Joel Ohman

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