Auto Insurance Collision Coverage Limits

• When you buy auto insurance collision coverage you must first designate an amount you wish to be covered for. This is usually $100,000.00, but can be more or less depending on your needs. The amount is often listed as property damage on an auto insurance policy because that limit also applies to comprehensive coverage.
  
  

Auto Insurance Collision Coverage Deductibles

• The next thing that must be designated on auto insurance collision coverage is the deductible. This is the amount you pay yourself before insurance money is paid. Most insurance companies start you with a $500.00 deductible. You can request to raise your deductible to $1000.00, $2500.00 or even more. That could lower your auto insurance bill significantly, but cost you more if you have an accident.
  
  

Auto Insurance Collision Coverage Use

• When you get into an auto accident your auto insurance collision coverage protects you. It covers much of the cost to repair damage to your vehicle when you hit something or something hits you. First the deductible is subtracted from the bill. You must pay that. The rest of the repairs, up to your collision coverage limit, is paid by your insurance company.
  
  

Who Needs Auto Insurance Collision Coverage

• If your car is new, in excellent condition or expensive to replace then auto insurance collision coverage is a good idea. If you don't have auto insurance collision coverage and you get into an accident you will have to pay for all the repairs yourself. If your car is financed or leased you will most likely be required to carry auto insurance collision coverage. The bank or lien holder doesn't want to lose their investment if you get into a crash.
  
  

Who Doesn't Need Auto Insurance Collision Coverage

• If your car is old, in poor condition or inexpensive then auto insurance collision coverage may not be a good use of your money. Auto insurance collision coverage is generally limited to the cash value of your car. If that isn't much then you may be paying for insurance that you wont get much use out of even if you do get into a crash. If this applies to you consider dropping auto insurance collision coverage.
  
  

Rules Concerning Auto Insurance Collision Coverage

• Unlike liability insurance, auto insurance collision coverage is not required by the states. However, if you have a loan on the vehicle, are leasing the vehicle or there is a lien holder then you may be required to have auto insurance collision coverage.