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Collision insurance is an optional type of coverage that provides protection to help cover the costs of damages if your vehicle is in an accident by hitting another car or object.
It provides financial assistance towards vehicle repairs or replacement if it is a write-off. If you lease or finance a car, it is likely mandatory to have collision coverage on your policy. You may also require this coverage to meet the conditions of your auto loan.
The need for this policy depends on your driving situation. Most drivers have it to reduce financial risk and have peace of mind. With it, you would be able to pay for repairs or replacement for an at-fault accident.
This coverage pays for losses caused when an insured vehicle is involved in an accident with another car or rolls over. Object includes another vehicle or a trailer attached to the car covered by your policy, the surface of the ground, and any object in or on the ground, says FSCO. The damage to your vehicle that it will cover includes:
Collision only provides coverage for auto accidents. It does not provide benefits if an object hits your vehicle. For example, if a tree falls on, it would be through comprehensive insurance.
Here is what you do not have coverage for:
Shop and compare collision insurance policies online. Our brokers will find the best rate from the leading insurers.
The cost of adding collision varies based on your provider, your driving history, the current value of your vehicle, and your deductible amount.
On average, adding collision insurance to your policy typically costs between $100 and $500 per year. However, this is not a flat rate. Because collision coverage pays to repair or replace your vehicle regardless of fault, the premium is highly personalized.
Key factors influencing your collision insurance rates include:
Collision insurance helps pay for repairing or replacing your car if it's damaged in a collision, regardless of who is at fault. The other driver's insurance might cover the damage if the other driver was at fault. If not, your collision insurance will cover the remaining costs up to the policy limits.
Imagine you are driving your car when another vehicle runs a red light and crashes into you. The accident causes damage to your car's front bumper and headlights. In this situation, your collision insurance will come into play.
To get your car repaired, file a claim with your insurance company and provide them with the necessary information and documentation. They will assess the damages and provide the funds needed to repair your car, minus your deductible.
Collision coverage is an insurance policy that protects your vehicle if you are in an accident with another car or object. It protects your vehicle when it is in motion.
On the other hand, comprehensive coverage offers protection against non-collision-related damage or loss, such as theft or damage caused by harsh weather conditions. It protects your vehicle when it is parked. Both types of coverage are recommended so you have complete protection.
Adding collision coverage to your car insurance may or may not be worth it, depending on whether it makes financial sense. Consider:
| Vehicle Age/Value | Collision Recommended? | Reason |
|---|---|---|
| New / leased | Yes | Required by lenders; high replacement cost. |
| 5–10 years old | Optional | Depends on "10% rule" (insurance premium vs car value). |
| Value less than $3,000 | Likely no | Deductible and premiums may exceed potential payout. |
While reducing coverage can save money, maintaining enhanced protection is often the smarter financial move under specific circumstances. You may want to keep your current level of coverage if:
While it sounds like a standard form of coverage, it is not mandatory. But it is recommended, especially if you have a newer vehicle.
Without collision you will have to pay out of pocket. You would have to repair damage to your vehicle from an at-fault accident.
It depends on your personal automobile policy. Some policies include rental cars. If you have the OPCF 27 endorsement, it will apply to rental cars.
If you are involved in an accident and don't have collision coverage, but you're not at fault, damages to your vehicle will still be covered. However, in the case of a hit and run, you would only be covered under the collision coverage portion of your insurance if you had the coverage. It is important to note that even if you are not at fault, you would not be covered during a hit and run without collision coverage.
A deductible is a mandatory part of adding collision to your policy. As with standard automobile insurance, you can choose the value. The higher the deductible you choose, the lower your premium cost - you only pay this amount if you file an accident claim. Most insurers offer a $500 deductible.
Depending on the plan, it can cost between $100 and $1,000. Speak with our team today to see how much adding collision coverage will affect your monthly payments.
Direct Compensation Property Damage (DCPD) covers the cost of repairing your vehicle when you are not at fault, or only partly at fault, in a collision with another insured vehicle. In most cases, there’s no deductible. Collision coverage, on the other hand, is optional protection that pays for damage to your vehicle when you are at fault, when you strike a stationary object, or when a hit and run occurs.
Collision insurance is not mandatory, while liability insurance is. Third party liability insurance protects against claims of damage and injuries to people and property. Collectively, they provide better overall protection when driving.
Even when the roads are clear, accidents can happen. If you are looking to add collision insurance, contact a licensed broker at ThinkInsure. In under 5 minutes, you can compare multiple car insurance quotes with collision insurance coverage from Canada's top providers.
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Digital Content Writer
Kayla-Jane has been a content writer with ThinkInsure since 2020. She creates insurance content for auto, home, and commercial. Kayla-Jane has a diploma in Journalism.
| Categories | Industry NewsAuto |
|---|---|
| Tags | Auto CoverageFAQsAccidents |
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