What is it & what does it cover?
You double-check your rear-view mirror and blind spots. You look both ways at every stop sign. You’re extra careful when navigating the crowded parking lot. And yet, collisions can happen to even the most careful driver! From small fender benders to full-on accidents, collision insurance coverage could help you avoid paying out-of-pocket for damage to your car. Not sure what it is or whether you need it? Stick around, and we’ll explain what collision insurance is, and how it works.
What is collision insurance coverage?
Collision insurance is an optional car insurance coverage that protects your vehicle and your wallet from costly repairs in case of a collision. Whether your vehicle is damaged in an accident that you are responsible for, or a hit and run in the mall parking lot, collision coverage can help cover the expenses. Although the details of coverage can vary from province to province, the overall benefit of collision coverage is that you could reduce out-of-pocket expenses in the case of an accident, apart from your deductible. This kind of coverage can be added to your car insurance policy to make sure you’re covered if you experience a collision.
What does it cover & when should you get it?
Collision insurance covers the cost of repairing or replacing your vehicle if it's damaged in a collision with another vehicle or object, such as a tree or a fence. It covers things like:
- An accident or collision with another car
- Hitting an object with your car
- If your car flips over
- A hit-and-run accident
Collision coverage is usually optional in Canada, but it can be a great benefit, especially if you have a newer or more valuable vehicle. Ask yourself, in the event your car is completely destroyed in an accident, can you afford to replace your car? If the answer is “no” then collision coverage is for you. In fact, it’s often required by your lender if you are financing or leasing your vehicle.
What it doesn’t cover
Coverage details can vary by province and by insurance company, so make sure you review your insurance company’s policy details to understand the specific coverage and any exclusions. With that said, collision insurance typically doesn’t cover damage that’s not caused by a collision, such as:
- Damage caused by theft, vandalism, fire, a windstorm or earthquake. If you need coverage for these types of situations, you can look into comprehensive coverage.
- Medical expenses related to injuries from an accident. These expenses are usually covered by accident benefits coverage.
- Damage to someone else's property or another person’s injuries caused by a collision. These damages are usually covered by liability insurance
What is the difference between comprehensive vs collision coverage?
Collision coverage covers damage that’s a result of a collision with another vehicle or object. On the other hand, comprehensive coverage provides coverage for damage to your vehicle caused by other incidents, such as theft, vandalism, fire, natural disasters (e.g. windstorm, hurricane, tornado, earthquake, etc.), or falling objects.
Most vehicles are insured for both collision and comprehensive. If you cannot afford to self-insure or pay out of your own pocket if your vehicle is damaged, both coverages are for you.
How to get collision coverage
Now that you know the ins and outs of collision coverage, you’re better equipped to decide whether it’s something you want to add to your auto insurance policy. Whether you’re getting car insurance for the first time or want to add coverage to your existing policy, getting collision coverage with belairdirect is easy! Our advisors can help you review your policy and get the best protection for your needs.
Frequently asked questions about collision insurance
Collision insurance is not mandatory by law in Canada, but it can be required by your lender if you lease or finance your car. This allows the financing company to cover any losses if a collision occurs. Otherwise, collision coverage is an optional coverage in all provinces.
If your vehicle gets damaged in an accident where you are found to be at-fault and you don't have collision coverage, you could find yourself paying for the damage as well as any other charges such as towing costs.
If you are determined by your insurance company to be not-at-fault, it’s likely that direct compensation property damage will cover the cost of repairs, depending on which province you live in. However, if the accident was a hit-and-run incident, you would probably not be covered without collision insurance.
After an accident, an insurance adjuster will evaluate the condition of your vehicle. If it is deemed to be a total loss, this means that it would cost more to repair it than what the car is actually worth. You might be offered a settlement based on the car's actual cash value, depending on your coverage.