What is Collision Insurance & What Does It Cover?

September 12, 2019

driving off road damage

Here’s the simplest definition of collision insurance: It’s insurance coverage that pays to fix or replace your car if it’s damaged in a crash.

For example, let’s say you slip on an icy road. You swerve off the road and hit a tree, smashing the front of your car. Collision insurance can pay to repair the damage after you pay the deductible.

The key things to know about collision insurance:

    • It covers damage to your car if it hits another vehicle or an object, like a tree or a building.
    • It’s not the same thing as comprehensive insurance, which pays to fix your car if it’s damaged by something other than a crash.
    • It only covers the car you’re driving — not anyone else’s car, and not passengers or other drivers.
    • It typically includes a deductible, which means you have to pay a certain amount before the insurance kicks in
    • Collision coverage isn’t mandatory, but your car lender might require it.
    • Collision insurance is affordable!

Compare car insurance quotes for your vehicle

What does Collision Insurance Cover?

Collision insurance helps pay for any damage to your vehicle that results from an accident with another vehicle or object while your car is in motion. If you hit someone’s car, or if someone hits you, you’re covered. If you crash into a house, you’re covered. If you drive off a cliff, you’re covered (but we recommend not doing that). Single-car accidents — like if you go off the road or rollover — are covered, too.

If your car is totaled — that is, damaged so badly it can’t be repaired for a reasonable cost — then your collision insurance can pay for its depreciated value. That means you get a check for what the vehicle is worth (not what it would cost to buy a new one).

So, does auto insurance collision coverage cover towing or roadside assistance? Sorry, no. Here are a few other things that are not covered by collision insurance:

  • Damage to your car from wind, rain, fire, hail or floods
  • Damage to your car if you hit a deer or other animal
  • Damage to your car if a tree or other object falls on it while it’s parked
  • Theft or vandalism
  • Damage to other people’s cars
  • Medical bills for injuries caused by an accident

There are a few more definitions we should cover.

What is “other than collision insurance”? That’s just another way of saying comprehensive coverage, which pays for other damage to your car that’s not caused by a collision. In your policy, comprehensive coverage is usually packaged with collision insurance.

What is a collision deductible waiver? That’s additional coverage you can buy that pays your collision deductible if your car is damaged in an accident and the other driver is uninsured.

What is collision damage waiver insurance? That’s a special kind of insurance you buy when you’re renting a car. It pays to fix or replace the rental car in case of loss or damage, so you don’t have to file a claim (or pay a deductible) with your regular collision insurance.

Is Collision Insurance Required?

No. While laws regarding car insurance vary from state to state, collision insurance is not required in any state. Collision coverage exists to protect you, the vehicle owner, from losing a ton of money if your car gets damaged or totaled.

Now, if you have a car loan or a car lease, most lenders require that you maintain collision insurance coverage as part of the terms of the lease or loan. You will most likely have to provide proof of coverage.

Most drivers — 73 percent — do carry collision insurance coverage in addition to liability. But if you’re driving an older car, or you don’t mind owning a car with a big dent or missing bumper, you have the option to drop collision coverage. This can save you money on your car insurance, but if your vehicle is damaged in a collision that you’re liable for, you’ll have to pay for all the repairs. That’s right: the insurance company pays you nothing. (If another driver is liable for the collision, then their property damage liability insurance would pay for it.)

Wondering when to drop collision insurance? Here’s how you know it’s time.

How Much Does Collision Insurance Cost?

We ran the numbers for five popular cars in the U.S., all from the 2010 model year. Our sample driver persona is a 30-year-old woman who lives in suburban Atlanta. For the sake of comparing collision insurance rates, we averaged the three best quotes from insurers on Compare.com. Each quote is for a 6-month car insurance policy and includes comprehensive as well as collision.

Car Model Basic Liability Coverage Comprehensive and Collision Coverage Savings (per 6 months)

Honda Civic

$633 $1027 $394

Toyota Camry

$654 $1016 $362

Ford F-150

$688.50 $935 $247

Honda CRV

$634 $943 $309
Chevy Tahoe $680 $1003 $323

So if you’ve been wondering, “How much does collision insurance cost?”, you can see that for this driver, it averages around $326.90 per six-month policy (including comprehensive).

That means you can save a lot by dropping collision and comprehensive. However, you can lose a ton of money if your car crashes. The average collision insurance claim is $3,425, according to the Insurance Information Institute.

Don’t want to take that risk? Here’s a better way to save money: Compare quotes from different car insurers head-to-head, then pick the best deal for you!

Compare Car Insurance Quotes