Do I need collision coverage?
Collision auto insurance is designed to cover all losses that occur due to, as the name suggests, collisions. These collisions must, however, be directly attributable to the auto insurance collision policy holder’s fault. In other words the collisions must not be a fault of a third party. The type of collisions we are talking about may involve another automobile, or an object, or even the road surface. So, what happens is that once the auto insurance provider satisfied that the auto insurance policy holder was at fault, reimbursement is provided up to the extent of coverage.
If you have been involved in a collision and need advice, visit this site for claims assistance.
When making a determination of whether you need to carry auto insurance collision coverage, you will require understanding the nature of relationship between other forms of auto insurance and auto insurance collision coverage. It would be particularly relevant to see the line between comprehensive auto insurance coverage and auto insurance collision coverage. As far as these two auto insurance covers are concerned, the collision cover is able to take care of some risk exposures that are not covered by the comprehensive auto insurance cover.
This leads us to the following question: do you, or I, need collision coverage? If, for example, you have taken the comprehensive auto insurance, why would you need auto insurance collision cover? This is the answer: whereas, as the name implies, comprehensive auto insurance covers you comprehensively, fact is there are some obvious risks that are not provided for under comprehensive auto insurance. You will not, for instance, be compensated by your comprehensive auto insurance if the loss under question was a result of acts of vandalism by a family member. On the other hand the same loss is covered by the auto insurance collision coverage.
It is important to realize that as you ponder on your need for auto insurance collision cover that auto insurance deductibles will work just as they work in other forms of insurance. Therefore if your insurance cover is subject to deductible of, say, five hundred dollars, this is what happens: assuming the extent of coverage is at three thousand dollars, the insurance company will, subject to your payment of five hundred dollars, pay the balance of two thousand five hundred, that is, three thousand less the five hundred deductible. This also means that you have to ensure that you have set aside an amount equal to the amount that has been set as the amount of deductible, before you get reimbursed for collision.
The best way, therefore, to ensuring optimum utilization of your auto insurance dollar is by appreciation the major role of insurance. From this perspective you will be able to design an auto insurance bundle that that will effectively protect you from all the risk you are exposed to in relation to your ownership of automobile. It is, therefore, important to begin by clarifying the core role of auto insurance in general vis-à-vis the auto insurance collision coverage. Consider, for instance, bundling the auto insurance collision coverage with comprehensive auto insurance.