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What Is Collision Car Insurance?


WRITTEN BY: Julia Matseikovich

UPDATED: MAY 16, 2022 | 3 MIN READ

If you own a car, insurance is a must. Every state has laws that require it. However, the state minimum requirements only demand you have coverage for damage or injuries that are your fault. If you are looking for coverage for your own vehicle you are going to need collision car insurance. Here is some information to help you decide if you do need this type of coverage and just what it means for your car insurance policy.

Collision Car Insurance Quicklinks

What Is Collision Car Insurance?

Collision car insurance is the portion of your policy that pays to repair the damage done to your vehicle when you are at fault for an accident. This can be used if the accident involved another car or if you hit something, like a telephone pole.

Collision coverage is not mandated by the government, so you get to choose whether to have it added to your policy or not. However, if you have a loan to buy the vehicle the lienholder usually requires you to carry this type of coverage until the loan is paid in full.

What does collision car insurance cover?

Quite simply, collision insurance pays for damages done to your vehicle that are not covered by another driver’s insurance. In other words, it pays to have your vehicle repaired when:

  • You were found to be at fault in an accident
  • You were involved in a single-car accident

Do I have to have collision car insurance coverage?

Unless you have a loan for or are leasing your car, you do not have to have it as part of your car insurance policy. However, if you do not have collision coverage, you have to pay to repair damage to your car if it is in an accident.

What’s the difference between collision car insurance and comprehensive coverage?

Comprehensive coverage is another type of car insurance that is not required by the state but is often required by a lienholder. Unlike collision car insurance, comprehensive insurance covers vehicle damage that wasn’t caused during an accident. This coverage includes damage that was caused by:

  • Natural disasters
  • Theft
  • Vandalism
  • Falling objects like trees or construction debris
  • Broken windshields

For example, if you hit a tree while backing out of your driveway, your collision coverage will pay for the damage. However, if the wind blows the tree onto your car, the comprehensive coverage pays for the repair.

What Is a Collision Car Insurance Deductible?

The deductible is the amount of money you pay before your collision car insurance kicks in. This amount is per accident. The lower your deductible, the less money you pay out of pocket. However, choosing a lower deductible increases your insurance premium. A higher deductible results in lower premiums but you will have to pay more out of your own pocket if you have a claim.

For example, if you have a $1,500 deductible and repairs totaling $800, you would pay for 100% of your repairs. However, if you have repairs totaling $3,000, you would pay the first $1,500 and your car insurance company pays the other $1,500.

What deductible option should I choose?

Collision car insurance deductibles can be anywhere from $100 to $2,500 or more. The cost of collision coverage depends on the make, model, and year of the vehicle, and the amount of deductible you choose. The higher the deductible, the lower your monthly car insurance rates. 

It is important to consider the reality of how often you may need collision coverage. If you have an older vehicle, that doesn’t have a high value, and you are an experienced driver with few, if any, accidents, a high deductible might be a good choice. However, if you have a record of being in small accidents, or have inexperienced drivers you need to cover, a lower deductible may be the way to go. Since accidents do happen, consider how often you may have to pay the deductible and whether or not you have the money to do so.

How and when do I have to pay my collision deductible?

Any time you are in an accident that damages your vehicle you will have to pay the deductible amount to have the damage repaired. If you were not at fault for the accident, and the other driver’s insurance is going to pay for the damages, you may still have to pay the deductible until your insurance company can get the money from the other insurance company, at which time you will be reimbursed. 

When you take the car to the repair shop, they will send a bill to your insurance company for the amount of the bill minus any deductible. You pay the deductible right to the shop. Generally, the shop will not send the bill until you have paid your share.

What happens if I can’t afford to pay my collision deductible?

Selecting a deductible amount you will be able to afford is very important. If you need to use your collision insurance and do not have enough to pay the deductible, the shop owner may retain possession of your car until you pay it.

How to Add Collision Car Insurance to Your Policy

Generally, you buy collision car insurance when you first buy insurance coverage for the vehicle. If you already have a policy for a different car you can add this coverage when you change the information for your policy.

  1. Contact your insurance agent to let them know you have a new vehicle
  2. Discuss the need for collision coverage
  3. Decide on the deductible amount for the new coverage
  4. Have the agent endorse the new coverage on the policy 
  5. Pay the premium

It is also possible to add collision coverage to your policy yourself by going online and making adjustments. 

How much does collision car insurance cost?

Like all car insurance coverage, collision coverage cost depends on the make, model, and year of the car, your driving record, where you live, and how much deductible you choose. An expensive car is going to cost more to cover than an older, cheap one because the vehicle is going to cost more to repair if damaged.  However, in general, collision car insurance will add roughly $290 to your annual insurance premium.

Can I add collision car insurance if I don’t have comprehensive coverage?

No. If you want to put collision coverage on your car insurance policy, you have to carry comprehensive coverage too. However, insurance companies do allow you to carry comprehensive coverage without carrying collision coverage.

When should I remove the collision coverage from my policy?

While the main purpose of collision car coverage is to have damage to the vehicle paid for if you are in an accident, you need to consider the value of the car. You also need to consider whether or not you have the money to pay for any damage to the vehicle.

It may be fine to drive around with a bent fender, an accident may make it so your car is not drivable. Can you pay to have it replaced or repaired? If so, you can think about dropping collision coverage. If the car is only worth a couple of thousand dollars, you may want to drop collision coverage. However, if a crash means you will be without a vehicle because you can’t afford to fix it or buy a new one, keep the coverage.

Collision Insurance FAQs

Is collision car insurance full coverage?

Car insurance that is considered full coverage includes liability coverage to pay for any damage or injuries you cause to other vehicles and any occupants, comprehensive coverage to pay for non-accident damage to your vehicle, and collision car insurance to pay for damage done to your vehicle in an accident you caused.

What’s the difference between collision and comprehensive coverage?

Comprehensive coverage pays to repair damage to your vehicle that was not caused during an accident. It covers things like theft, natural disasters, fire, or hail. Collision coverage pays for damage done to your vehicle when you are involved in an accident with another vehicle or any object other than an animal.

Is it better to have comprehensive or collision car insurance coverage?

If you are worried about paying to have your car repaired regardless of the reason for the damage, keep both coverages. However, if you are a confident driver, with no at-fault accidents, and you are looking to lower your insurance bill, experts say to drop the collision and keep the comprehensive insurance. 

What’s the benefit of having collision car insurance?

Car repairs are expensive. Even a simple dent can cost thousands of dollars to repair. Collision car insurance pays for the cost of these repairs when you have been in an accident. 

What isn’t covered by collision car insurance?

Collision coverage doesn’t pay for any damage done to another vehicle in a car crash. It doesn’t pay for any medical bills. If the damage to the car was not sustained during an actual car crash of some type, collision coverage will not pay for the repairs.

Is Collision Car Insurance Worth It?

Whether or not collision car insurance is worth it depends on the type of vehicle you drive. If you don’t have a loan or lease for your vehicle and you can afford to repair or replace it, you might consider skipping collision coverage completely. However, if that’s not the case, keeping collision coverage is probably worth it. Keep in mind, you have to get insurance quotes from several insurance companies to ensure you’re getting the best rates possible.

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