In nearly every state, drivers are required to have property damage liability insurance in order to pay for damage that they cause in an accident. When another driver is at fault, their property damage insurance will cover repairs to your vehicle, and you will not be responsible for paying anything out of pocket. But if the accident is a hit-and-run, you can use your collision insurance or uninsured motorist coverage to pay for the damage.
Collision insurance pays to repair or replace your car when it’s damaged in an accident, and it usually has a deductible between $100 and $1,000. On the other hand, uninsured motorist property damage (UMPD) coverage, which pays to fix your car if you’re hit by an uninsured motorist, may not have a deductible depending on your state. Keep in mind that not all states offer UMPD, and even in those that do, you may not be able to use it if the at-fault driver is unidentified.
A collision insurance deductible is the amount of money that a driver must pay out-of-pocket when filing a collision insurance claim. Collision insurance pays to repair or replace a car damaged in an accident, and a driver must pay their collision deductible before their insurance company will cover the remaining costs.… read full answer
Collision Deductible Example
Say you are at fault in an accident that causes $10,000 in damage and you have a collision deductible of $1,000. You are responsible for covering your $1,000 collision deductible out-of-pocket in order for your insurance company to pay the remaining $9,000.
Collision Deductible Amounts
Collision deductibles typically range from $100 to $1,000, and you select your deductible amount when you purchase your policy. The higher your deductible, the cheaper your premium will be. Although it’s tempting to get a higher deductible in order to pay less upfront, you should only choose a deductible that you can afford to pay if your car is suddenly damaged in an accident.
A collision deductible waiver helps drivers save money on their deductible after an accident with an uninsured driver. Collision damage waivers typically apply only to accidents where an identified driver without insurance is completely at fault. A notable exception is California, where collision deductible waivers can be used in hit-and-run accidents. … read full answer
When a Collision Deductible Waiver Is a Good Idea
Collision deductible waivers are similar to uninsured motorist property damage (UMPD) insurance, so a waiver is usually redundant if you are already required by your state to have UMPD. In states where UMPD is optional or unavailable, collision deductible waivers can be a great alternative for the same type of coverage. However, keep in mind that you cannot purchase a collision deductible waiver without collision insurance.
Collision Deductible Waiver Cost
The cost of a collision deductible waiver is usually less than $50 for your entire policy term. Although collision deductible waivers can only be used in a limited number of situations, their low cost means they are a good investment if you want to avoid any out-of-pocket expenses in the event that you’re hit by an uninsured motorist.
Finally, it should be noted that collision deductible waivers are different from collision damage waivers, which are sold by rental car companies to cover damage to their vehicles.
You should file a claim with the other driver’s auto insurance company if you are not at fault for the accident and you have standard liability insurance but no collision coverage. Liability insurance pays for injuries and damage that a driver might cause to other people and property if at fault for a car accident. That means your liability insurance won’t be involved if you are not at fault. The other driver’s liability policy would cover the damage.… read full answer
But there are drawbacks to filing a claim with someone else’s insurance company. The other driver’s insurer will investigate your claim and confirm that its policyholder is at fault. And it’s typical for them to deny fault, especially if no police report was filed. If your claim is denied and you don’t have collision coverage, you’ll have to take the other driver’s insurance company to court, which could drag on for a while. Insurers know that the longer it takes and the more difficult it is to resolve a claim, the more likely it is that you will settle or drop it.
Things are a bit different if you have collision insurance, however. In that case, you can file a claim with either your auto insurance company or the other driver’s insurer. Filing with your insurer starts a process called subrogation. Your insurance company pays for your property damage and pursues compensation from the other driver’s insurance company after the fact. You may have to pay your collision deductible, but you could get that money back when your insurer settles with the other driver’s insurance company.
Collision insurance doesn’t cover your injuries, but if your insurance company is able to establish the other driver’s fault through subrogation, it might help get your medical bills paid by the other carrier. If the other driver was responsible for your property damage in an accident, they’re equally responsible for your injuries. Your insurance company will only pay for your injuries if you have medical payments coverage or personal injury protection.
If it turns out that the other driver doesn’t have insurance, you can make a claim through your uninsured motorist protection, if you have it. There is no deductible for uninsured motorist claims.
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