Does Car Insurance Cover Repairs?

Car accidents happen every day, leaving individuals scrambling to figure out how to pay for repairs. One of the first questions that come to mind is whether car insurance covers repairs. While the answer isn’t always simple, there are a few factors to keep in mind when answering this question.

What Types of Car Insurance Cover Repairs?

First, let’s take a look at the types of car insurance policies that cover repairs.

Collision Coverage

Collision coverage is an optional insurance policy that covers damages incurred from a collision with another vehicle or object. This type of coverage can come in handy when your car needs extensive repairs after an accident.

Collision coverage typically has a deductible, which is the amount of money a policyholder must pay out of pocket before the insurance coverage kicks in. This deductible can range from a few hundred to a few thousand dollars.

Comprehensive Coverage

Comprehensive coverage is another optional insurance policy that covers damages incurred from events other than collisions, such as theft, vandalism, and natural disasters. This type of coverage can also help cover repair costs.

Like collision coverage, comprehensive coverage typically has a deductible that policyholders must pay before the insurance coverage kicks in.

Liability Coverage

Liability coverage is a mandatory insurance policy that covers damages or injuries to other people or vehicles if you are at-fault for an accident. While it doesn’t cover repairs to your own vehicle, it can help cover the costs of repairs for the other party involved in the accident.

What Factors Determine Whether Repairs Are Covered?

While having car insurance can certainly help cover repair costs, there are several factors to consider when it comes to whether repairs are covered under your policy.

Type of Policy

As mentioned earlier, collision and comprehensive coverage are optional policies, which means that they are not automatically included in a car insurance policy. If you do not have these policies, damages incurred from a collision or other event may not be covered under your plan.

Liability coverage, on the other hand, is mandatory in most states and only covers damages and injuries caused to other people or property.

Deductible

The deductible is the amount policyholders must pay out of pocket before the insurance coverage kicks in. If the cost of repairs is less than the deductible, the policyholder will be responsible for covering the costs.

Age and Condition of Vehicle

Car insurance policies may only cover repairs up to the actual cash value (ACV) of the vehicle. The ACV is determined by an insurance adjuster and accounts for the age and condition of the vehicle.

If the cost of repairs exceeds the ACV, policyholders may be responsible for covering the difference out of pocket.

FAQ: Common Questions About Car Insurance and Repairs

Conclusion

Car insurance can be a lifesaver when it comes to paying for repairs after an accident. However, not all policies are created equal, and there are several factors that determine whether repairs are covered under your policy.

By understanding the types of car insurance policies that cover repairs, the factors that determine whether repairs are covered, and some common FAQs, you can make informed decisions when it comes to choosing the right car insurance policy for your needs.