Collision Insurance

AAA

DEFINITION of 'Collision Insurance'

A type of auto insurance coverage. Collision Insurance will reimburse the insured for any damage sustained to their personal automobile that is due to the fault of the insured driver. This type of insurance is often added as an extension of a basic policy.

INVESTOPEDIA EXPLAINS 'Collision Insurance'

As the name implies, Collision Insurance repays the insured for damage from an actual collision. It does not cover damage due to theft or vandalism. It also does not cover damage that is paid from another driver's policy, if the other driver was at fault.

RELATED TERMS
  1. Ambulance Chaser

    In insurance, a derogatory term for lawyers and other service ...
  2. Windstorm Insurance

    A special type of property-casualty insurance that protects policyholders ...
  3. Adequacy Of Coverage

    The adequacy of coverage concerns how well your insurance policies ...
  4. Apportionment

    The allocation of a loss between all of the insurance companies ...
  5. Self-Build Insurance

    An insurance policy that provides coverage during the construction ...
  6. Auto Insurance

    A policy purchased by vehicle owners to mitigate costs associated ...
Related Articles
  1. Options & Futures

    Beginner's Guide To Auto Insurance

    Find the perfect policy that suits both your coverage and budgetary needs.
  2. Options & Futures

    Top Tips For Cheaper, Better Car Insurance

    Accident, theft, vandalism - make sure your coverage will protect you when you need it most.
  3. Insurance

    Do You Need Casualty Insurance?

    Find out how different types of coverages can protect you and which policy is right for you.
  4. Insurance

    The True Cost Of Owning A Car

    Driving is often the most convenient way to get around, but it'll cost you.
  5. Insurance

    How to Use a Waiver of Subrogation

    A waiver of subrogation means that a party to a contract waives the right to allow someone (usually an insurance company) to sue the other party to the contract in case of a loss.
  6. Home & Auto

    You Could Own A Mercedes Without Knowing It

    Thieves are now using stolen identities to lease or buy new vehicles, drive them off the lot, then disappear without making a payment.
  7. Insurance

    Steer Clear of Over-Priced Gap Insurance Providers

    Major insurers will generally give you a better deal on gap insurance than a car dealership. But watch for gaps in gap coverage.
  8. Insurance

    Do Drivers Really Need Gap Insurance?

    Gap insurance is worth it for drivers who are significantly upside-down on their car loan. That includes lessees and buyers with a small down payment.
  9. Insurance

    Get Up To Speed On Car Gap Insurance

    It covers the shortfall if your car is stolen or totaled, and insurance pays less than you owe on your loan. Dealers may push you to buy it. Should you?
  10. Insurance

    Insurance Myths Involve Houses, Cars & Big Crashes

    Any confusion over what to buy or how to use a product can end up being costly, but when it comes to insurance, misunderstandings can cost thousands.

You May Also Like

Hot Definitions
  1. Subsidy

    A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy ...
  2. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
  3. Technical Skills

    1. The knowledge and abilities needed to accomplish mathematical, engineering, scientific or computer-related duties, as ...
  4. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  5. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
  6. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
Trading Center