Collision (Auto)
What does collision coverage pay for?
Collision coverage pays for damage to your own vehicle caused by a crash, meaning your car makes physical contact with another vehicle, an object, or the road surface. Hitting another car at a stoplight, backing into a concrete pillar, sliding into a guardrail on wet pavement, rolling a vehicle, or going into a ditch are all collision claims. The other driver does not need to be involved. Collision is about the physical impact, regardless of fault.
When is collision coverage required versus optional?
Collision is optional on a personal auto policy unless your vehicle is financed or leased. If you have a loan or lease, the lender or lessor requires it because the vehicle serves as collateral for their financial interest. Once the vehicle is paid off, the decision depends on the vehicle’s current market value. On an older car worth $5,000 to $7,000, paying $500 to $700 annually for collision means you could spend one to two years of premiums and still net less than a total-loss payout after your deductible. For example, a 10-year-old sedan with an actual cash value of $6,000 and a $1,000 deductible gives a maximum payout of $5,000 on a total loss, while two years of $600 collision premiums cost $1,200 with no guarantee of a claim.
How does the collision deductible affect my premium?
A higher collision deductible lowers your premium meaningfully. The right deductible is the highest amount you could pay out of pocket without genuine financial hardship. As our guide on replacement cost vs. actual cash value explains, the settlement amount on a total loss starts with the vehicle’s market value and then subtracts the deductible, so a higher deductible means a smaller check in the worst-case scenario. Collision coverage is most valuable for losses that would be difficult to absorb on your own, not for every minor scrape that barely exceeds the deductible.
What does collision coverage not include?
Collision does not cover everything that can go wrong with a vehicle. A tree falling on your car, hail damage, theft, or a deer strike are comprehensive claims, not collision claims. Comprehensive coverage handles non-crash physical losses. Both coverages carry a deductible, but many drivers set them at different amounts. For example, a driver might carry a $500 comprehensive deductible for hail and theft risk while choosing a $1,500 collision deductible to lower the premium on the crash coverage. Our page on what a coverage review involves walks through how an advisor helps weigh those choices together.
How does collision coverage interact with an uninsured driver claim in Georgia?
In Georgia, if the at-fault driver in a crash lacks enough liability coverage to fully repair your vehicle, your own collision coverage can step in after your deductible without waiting on the other driver’s insurer to accept liability. Uninsured motorist property damage coverage can also address this gap in some situations, but collision is often the faster path because you work directly with your own insurer. Our guide on Georgia auto minimum limits explains why many drivers on Georgia roads carry only the state floor in liability, making this scenario more common than most people expect. A coverage review can help you weigh the right deductible and confirm your full auto policy has the right protections in place.