Posts Tagged ‘collision car insurance’

Does Auto Insurance Cover Under the Hood Damage to the Car after an Accident?

Wednesday, March 28th, 2012

No driver wants to think about the possibility that he or she will be involved in an accident, and the question, “Does auto insurance cover under the hood damage to the car after an accident?” is an important one. If a driver has been involved in an at-fault accident, he or she must have physical damage coverage in place to pay for repairs to the vehicle.

If the owner has the right kind of coverage in place, the insurance company will pay for visible damage as well as problems under the hood. The driver will want to make sure the car has been examined carefully by a licensed mechanic. This inspection will reveal any problems with the car caused by the accident. If the additional damage was discovered after the insurance company has made an offer to settle the claim, the owner should contact the insurance company to advise it of the additional damage and to ask that the estimate for repairs be adjusted.

Collision Insurance for Under the Hood Damage

If the under the hood damage was caused by striking another car or an object, collision coverage would be used to pay for it. The vehicle owner would be responsible for paying the policy deductible and the insurance company would be responsible for paying the balance, up to the policy limit which is in place.

In a situation where the damage to the car is extensive and it is declared a write-off, the insurance company’s offer to settle the claim will be based on the car’s cash value at the time of the accident. The company will do some investigating to find out how much similar vehicles (make, model year, amount of mileage) would cost to purchase before making an offer to settle the claim. The owner will not receive the amount he or she paid for the vehicle or the cost to buy a new car.

Comprehensive Insurance for Under the Hood Damage

Not all damage to a vehicle is caused by a collision, and comprehensive coverage pays out when the loss is due to other types of events. Hail, wind, flooding or striking an animal could cause damage to the car’s inner workings.

New car owners who have taken out a loan to finance their vehicle will need to keep full coverage (collision and comprehensive protection) in place until they have paid it off in full. The lender wants to make sure that its investment is protected if a loss occurs. If the car is a write-off, the insurance company will reimburse the lender for the cash value of the vehicle. The owner would still be responsible for paying any outstanding balance on the loan, if he or she does not have gap insurance coverage in place to cover it.

Collision and comprehensive coverage will pay for visible as well as under the hood damage to a vehicle. Make sure that both types are addressed following an accident so that the car is repaired properly.

 

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Posted in General Car Insurance |

Can I Buy Comprehensive Auto Insurance Coverage Only

Wednesday, February 1st, 2012

Drivers who are looking for ways to keep costs down may be wondering whether they can buy a policy with comprehensive auto insurance coverage only. Some insurance companies will write a policy for comprehensive protection only in certain very special circumstances.

Auto insurance buyers are required to have at least a minimum level of protection in place under the laws of the state where they live. In most cases, while liability auto insurance coverage must be kept in place, collision and comprehensive coverage are not a legal requirement.

If the owner took out a loan to pay for his or her vehicle, the financing company will probably require that full coverage (collision and comprehensive) be kept in place until the car has been paid off in full. The lender will want to make sure that its interest in the vehicle is protected in case it is totaled in an accident.

Auto Insurance When the Car is Fully Paid off

In a situation where the vehicle owner paid the full amount of the purchase price in cash or the car has been paid off, the owner is required to maintain the minimum level of coverage required under state law. Physical damage coverage (collision and comprehensive insurance) is not usually a legal requirement, and a vehicle owner can drop this protection if he or she wishes to do so

Dropping the collision coverage entirely can help a vehicle owner save on his or her auto insurance costs, since this type of protection accounts for a good portion of the amount paid in premiums. To save even more, the owner could limit the comprehensive protection to fire and theft only.

Auto Insurance for a Garaged Vehicle

If a car is not going to be driven at all for a time, the owner may want to consider dropping the collision protection during the time it is off the road. The owner may want to keep comprehensive protection in place in case the vehicle is stolen or damaged while it is in the garage.

The vehicle owner will need to notify his or her auto insurance company when the car is being driven again so that the policy provisions can be changed. It’s important to make sure that the car is not driven until the policy update takes effect. If an accident occurred in the meantime, there would be no coverage on the vehicle.

Collision Only Coverage for an Antique Vehicle

An insurance provider may write a policy for comprehensive coverage only in a case where the car is not being driven regularly. Antique vehicles which are not driven but which need protection when on display and while being transported to and from a show may be insured in this manner. A person who owns one of these vehicles will need to ask the insurance company for a special quote for coverage.

In most cases, an insurance company will only write a policy which has collision and comprehensive protection. A driver who is interested in buying comprehensive protection only will need to contact different providers to ask whether the company will write this type of policy.

 

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Posted in General Car Insurance |

Do I Need Collision Auto Insurance Coverage

Friday, January 6th, 2012

The question of whether a driver needs collision auto insurance coverage is a very simple one to answer. In most cases, a vehicle owner can benefit from having this type of physical damage protection in place. New car owners who took out a loan to finance their vehicle will likely be required to keep collision coverage in place until the loan is repaid in full as a condition of borrowing. The lender will want to make sure that its interests are protected if the car is totaled.

An older model vehicle, which no longer has an outstanding loan, may not need to have collision protection in place. Since this type of insurance pays out based on the car’s cash value, once the vehicle gets to the point where its value is at or below the policy deductible, it no longer makes good financial sense to keep this protection in place.

What Collision Auto Insurance Covers

Collision auto insurance pays for repairs to the policyholders owned vehicle following an accident which involve striking and in animate object. It also pays for damages sustained in a rollover accident.

Collision Auto Insurance Deductible

Before the auto insurance company will pay out on a claim made under the collision portion of the policy, the vehicle owner is required to pay a deductible. The exact amount will depend on what was agreed to when the policy was written.

Privacy when keep their auto insurance costs down can choose to buy policy with a higher deductible. Insurance companies offer lower rates to consumers who are prepared to take on a higher level of risk to cover loss personally and the higher the policy deductible, the lower the premium rates.

Comprehensive Auto Insurance Coverage

Comprehensive auto insurance coverages the other take the physical damage protection available. It pays out for losses caused by an event other than a collision, including

  • Falling objects
  • Fire
  • Flooding
  • Hail
  • Striking an animal
  • Theft
  • Vandalism
  • Wind

The driver will also pay a deductible before the auto insurance provider will write a check to settle a claim made under the comprehensive part of the policy. The vehicle owner will need to consider the amount of his or her policy deductible carefully to ensure that this amount will not result in financial hardship if he or she needs to make a claim against the policy.

When to Drop Collision Auto Insurance Coverage

At a certain point, it no longer makes sense to keep full (collision and comprehensive) coverage on a vehicle. The driver is paying a steady amount in premiums for a level of protection that continues to diminish over time.

By the time the car has been paid off in full, its cash value may be low enough that dropping the collision coverage entirely can make sense. Comprehensive coverage can be limited to fire and theft only to provide some protection to the vehicle owner.

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Posted in General Car Insurance |

What Type of Auto Insurance Do I Need if My Car is Paid Off

Friday, October 28th, 2011

The question of what type of insurance a driver needs to have in place once his or her car has been paid off is one that a number of people are curious about. A driver’s auto insurance need change once the car loan has been paid off in full. At that point, it may not make sense to keep full coverage on the vehicle in place. Full coverage refers to collision and comprehensive protection.

Collision Auto Insurance Coverage

Collision auto insurance coverage pays for damages caused to the vehicle due to striking or being hit by an inanimate object. It also pays out when the damage is caused by a rollover accident or if the car is struck by a hit and run driver.

The owner is required to pay a deductible before the insurer will cover any of the costs to repair the car. This amount should be considered very carefully, since drivers who agree to pay more toward the cost of repairs to their vehicle will be able to qualify for lower premium rates. It doesn’t make good financial sense to set the deductible at a level which will cause financial hardship if a driver needs to make a claim for damage to the vehicle following an accident.

Comprehensive Auto Insurance Coverage

Comprehensive auto insurance pays out when the damage caused to a vehicle stems from an event other than a collision. This is the part of the policy which pays out for claims due to hail, wind, flooding and falling objects. It also pays out when the accident involves striking an animal or flying gravel has cracked the windshield of the vehicle.

This type of coverage pays out for damage caused by fire or an act of vandalism. It also covers the vehicle in case it is stolen and not recovered.

Auto Insurance for a Financed Vehicle

If you are like most people and took out a loan to pay for your car, the financing company will probably require that full coverage be taken out on the vehicle as a condition of advancing the funds. The lender simply wants to make sure that its interests are protected.

If the car is totaled in an accident before it is paid off in full, the insurance company will receive a payout equal to its cash value. If this amount is not high enough to fully pay off the amount owing on the vehicle, the owner is responsible for paying the difference personally.

Auto Insurance When Car is Paid Off

Collision and comprehensive coverage pay out based on the car’s cash value. It doesn’t make sense to keep full coverage in place for an older model vehicle which is worth approximately the same amount as the policy deductible. At that point, dropping the collision coverage and limiting the comprehensive protection to fire and theft only is a reasonable choice. It will also help to keep coverage costs down.

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Posted in General Car Insurance |

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