Collision insurance safeguards your car if you hit a stationary object or another vehicle. It pays for physical damage to your car, no matter who’s at fault.1 State law doesn’t require drivers to carry collision coverage, but your lender or lessor may require it if you finance or lease your vehicle.

Understanding what collision insurance covers is important as a vehicle owner so you can get your car back on the road quickly after a covered loss. Here’s exactly what collision insurance covers and what it doesn’t cover.

What collision insurance covers

Collision insurance is your financial safety net if you hit another vehicle or stationary object. Unlike liability coverage — which pays for damage you cause to others — a collision policy covers your own car. It takes care of the cost of repairing or replacing your vehicle in the event of an accident, minus your deductible.

Here are some scenarios collision car insurance would cover:1

• Hitting another vehicle

• Hitting a telephone pole, tree, or traffic sign

• Driving over a pothole

• Flipping or rolling over your vehicle, even if other cars are involved

Collision insurance plays a crucial role in keeping your finances secure, especially if you’re at fault for the damage.

What collision insurance doesn’t cover

While collision insurance can cover various scenarios, a few exclusions exist. A few situations when it doesn’t kick in include:2

When you might need collision insurance

A collision policy is optional coverage, but it can be essential to your auto insurance policy. It’s especially beneficial if you don’t have money to pay for repairs or replacement if your car is a total loss.

It’s a smart choice if you have a newer, more expensive vehicle or drive in high-traffic areas with a higher risk of accidents. But if you have an older car with a low value, the cost of collision coverage might outweigh its benefits.

Keep in mind that even though state law doesn’t require it, lenders and leasing companies can mandate collision insurance coverage if you finance or lease your vehicle.

Collision insurance pros and cons

Carefully considering your coverage options is a good idea to find the right balance between protection and affordability. You want the proper protection in place without paying for more coverage than you need.

Here are a few pros and cons of collision car insurance:

Collision vs. comprehensive insurance

Comprehensive insurance is another type of car insurance coverage. It pays for damage to your vehicle from events other than collisions — such as theft, vandalism, weather damage from natural disasters, and animal collisions.1 Drivers often buy comprehensive insurance coverage alongside collision insurance as part of a full-coverage insurance policy.

Full coverage bundles together liability, comprehensive, and collision insurance for more protection for your vehicle. You may want to ask your insurer about full-coverage insurance if you drive a newer, high-value car, even if your lender or leasing company doesn’t require it.3