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Collision Auto Insurance Explained

Collision Auto Insurance Explained

An auto collision can happen out of anywhere. When you’re driving to the supermarket, when you’re parking in a busy parking lot, or when you’re going 65 miles an hour down the freeway. In any case, you’ll want to make sure you have a good collision auto insurance plan in place so that you know you and your vehicle are protected in the case of an accident.

Because collision auto insurance is usually considered optional when purchasing auto insurance, many people forgo it in an effort to save money. In a few cases it may not be worth purchasing, like if your car is worth very little. Collision auto insurance is designed to cover the cost of repairing or replacing your car in the event of an accident in which the other car is not insured, or there is no other car involved in the accident. Because it doesn’t cover the cost of repairing other cars or property involved in the accident, it is not required in many states. That doesn’t ‘mean it’s not necessary.

Rather, collision auto insurance is important to have, especially if you have an auto loan on your car, Many auto loans will require the car owner to purchase auto collision coverage before approving the driver for a loan because this protects the bank. If the car is destroyed in an accident and there is no insurance to cover the damage, this leaves the bank unprotected because they no longer have any collateral in exchange for the loan.

Another important reason to invest in collision auto insurance is if you have recently purchased your car. Even if it’s all paid off, if you hit a slick spot on the road during a rainstorm and total your car, without proper coverage you could be out the entire cost of what you just paid for your new car. But if you have collision auto insurance, then you can breathe easy knowing that you will be reimbursed for the entire value of your car repairs. Some insurance companies also offer to replace your car with a brand new car if it ends up totaled within the first year after purchase. Your car should be considered one of your largest investments and it’s foolish to not do the best you can to protect your investments properly.

Even if you don’t have a loan or a new car you should still consider purchasing collision auto insurance. 35% of drivers on the road are uninsured, which means if one of them crashes into your car, you could be left paying for the damages even if it’s not your fault.

You can’t always prepare for an accident, but you can make sure you’re prepared to deal with the costs of one. Based on your driving record, the cost of collision auto insurance varies significantly between provider and driver. But it’s important to keep in mind that while collision auto insurance may cost you a bit up front, it could end up saving you thousands of dollars in the long run.

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