While most have some understanding of liability insurance, many wonder, "What is collision coverage?" when purchasing auto insurance or after a wreck as they explore options for recovering damages.
Collision coverage is not among the minimum insurance requirements in West Virginia. It pays for damage to your car (minus your deductible) if you’re in a collision. Read on to learn more about this coverage.
Understanding Collision Coverage
If you carry collision coverage, your insurance company will pay for the repairs to your car if you’re involved in an accident. It can apply if you’re involved in an accident with another party or if you hit a stationary object. It applies regardless of whether you or another party is to blame for the wreck.
Here are the two basic things you need to know about collision.
- Cash value: The insurance company will only pay for damages to your car up to its actual cash value. If repair costs exceed the actual cash value, then it may declare your car totalled, or is considered a “total loss.”
- Deductible: You will also have to pay a deductible, usually around $500. Generally speaking, the more your car is worth and the lower your deductible, the higher your premiums (monthly out-of-pocket payments).
If you are financing a new car, your lender may require that you carry collision coverage. Car lenders will usually require what’s called comprehensive coverage, which differs from collision. This covers damage that occurs to your car in other ways, such as by fire or other perils.
However, if you have an older car, collision coverage may not be a good choice for you. CNN Money explains: “For cars worth less than $5,000, comprehensive and collision probably aren't worthwhile. Over time, the premiums you'll fork over will probably exceed the payout, even if your car is totaled. Plus, in an accident that isn't your fault, you can figure that the other driver's insurance will cover your car.”
To determine whether or not collision coverage is right for you, you can speak to your insurance provider and discuss your needs and review your options.
Injured in an Accident in Clarksburg? Call the Miley Legal Group
Collision coverage covers vehicle damage, but it doesn’t cover your medical bills, lost wages, or pain and suffering. For more information on how to pursue compensation for these types of damages if you're ever in an accident in Clarksburg, call our injury attorneys at the Miley Legal Group today. Contact us today at 304-931-4088 for a free consultation.