Shopping and finding good car insurance in the Amarillo area is simply reducing risk that may occur in case of a car accident. Today, car insurance has been made mandatory by nearly all the countries if not all them. More often than not, people prefer to insure a third party insurance cover as opposed to comprehensive insurance coverage. This is because comprehensive insurance cover is by far more expensive as compared to third party insurance cover. Amazingly, both ways of insurance cover are acceptable by the government.
What is collision coverage?
Collision coverage covers your car if it’s damaged or destroyed in an accident. Actually, the cover will typically pay to replace or fix the car. Before choosing collision coverage, there are a number of important factors that you should pay attention to:
1. Your vehicles value
· If your car is not very expensive it would be advisable to consider paying accident expense related to it out of your pocket rather than providing collision cover for it. Opting to provide insurance cover may be uneconomical due to annuity payments which are there to stay as long as your car is on the road.
· For expensive vehicles with values going for as high as $5,000 and above, going for a full collision coverage is the most appropriate decision. It is unrealistic to pay collision services on your own and it’s not even worth a gamble.
· If you have a loan on your vehicle, renders are not ready to take chances and will push you to have collision coverage on your auto policy. Nonetheless, in Amarillo Texas there are some renders and states that are not determined to push you to have collision coverage and leaves you to make an independent choice. It’s so unfortunate if you do not provide collision coverage, in the event of car damage since you will have to pay the full value of the loan with no tactic to recoup money from the vehicle.
· Over a course of 4 or 5 years, after your vehicle has undergone depreciation for more than four years you should quite from collision coverage because if you don’t, you might end up paying your insurer more than the value of your car.
2. Depreciation in value of your vehicle over time
Depreciation is basically loss of vehicle value due to factors such as wear and tear. The value at which your car depreciates depends on how much you use it. The approach used by accounts to provide for depreciation depends on the formula used and in most cases is calculated as a percentage. For instance, a car may be depreciated at 20% per year over its useful life. Therefore, the provided percentage is just a fix and may not necessarily reflect the actual loss of value. The decided percentage is used by insurers when determining premium to be paid. Sadly, most insurers raise the amount of premium to be paid as the vehicle depreciates due to increase in possibility of encountering collision thus increasing the financial burden to the person paying premium. The moment you realize the burden is huge, that’s the perfect time to terminate collision coverage.
3. Your risk of an accident
· How many miles do you drive in a year? How frequent do you drive? Well, this might just give you a rough idea on how much you need collision coverage. More often than not, you will find out that those who drive frequently have higher chances of finding themselves in car accident. Simply, this means that you can forego collision coverage cost by not calling for the service if you don’t drive frequently. but before you come to this conclusion you must also take into account other factors so as not to make uninformed decision.
· If you drive every day more so in urban centers, likelihood of colliding with other vehicles is very high. In urban centers traffic jams are very common mostly at rush hour that’s when most people are heading for work and rushing home from work. Traffic jams are the main cause of minor car collisions. Car engineers have for long tried to develop vehicles that are able to overcome collision but is only recently that they found solution. Even so, their engineering work has not been a walk in the park, as for their innovation to work all the cars must have their engineered properties. The kind of risk that you are exposed to when driving daily will only be dealt with amicably by insuring your vehicle against collision.
Collision insurance deductibles
For collision insurance, you must choose a deductible, which is an amount that you decide to pay when you have a claim. Ideally, if you choose higher deductible value, your insurance payment reduces tremendously. Make sure you choose a deductible that you can afford to pay out of your pocket at any given time.
When going for collision insurance, you are also needed to submit state amount, which is the best estimate of the current value of your car. The state should put into account the age, condition of your vehicle and any permanently attached equipment.
Collision coverage exceptions and restrictions
You must have comprehensive insurance or theft and fire with CAC in order to pick collision insurance
You can buy a physical damage only policy, which include two insurance coverage
· Collision insurance
· Either fire and theft with CAC or comprehensive insurance
Collision insurance can’t be applied to non-owned trailers, like those used as part of trailer interchange agreement.
Since comprehensive insurance has been mentioned severally, it’s more appropriate to take a closer look of damages covered under comprehensive auto insurance
· Natural disasters: tornadoes, earthquakes, hurricanes, storms, hailstorms
· Fire, explosions, civil commotions
· Vandalism and theft
· Broken windows and windshield
· Falling objects
· Acts of god
· Damage from impact from animals
The amounts of misfortunes glaring at our vehicles are so many. It is therefore, our responsibility to speculate and avert them whenever we can. Since we cannot fully avoid risk it is more advisable to insure our vehicles against those risks. More importantly, we should always take precautions before buying an insurance cover. This will ensure that we deal with genuine insurers who will compensate us in the event of accident.