Demystifying Collision Coverage
By Dan Patrico, Personal Insurance Advisor
Dealing with insurance isn’t the most fun task, and many people avoid it except when absolutely necessary. Often, people are seeking an auto insurance quote because they are unhappy with the service at their current agency, they are scouting the market for a more competitive price, or they just purchased a new vehicle. This quoting process can seem daunting or irritating at times, but the agent behind the phone knows what information he needs and has reasons for asking certain questions.
One of the primary factors of an auto quote is the collision deductible amount. A common question that I’m often asked is, “What is the difference between Broad Form Collision and Standard Collision?” I have noticed that some agents will automatically quote the client with Broad Form, or Standard Collison without explaining the difference. My goal is to help clients understand insurance terminology and hopefully equip them with valuable knowledge.
If you are in an auto accident and you want your insurance company to pay for your vehicles damages, you want collision coverage, often referred to as Full Coverage. There are four types of auto insurance, listed below in order of most to least coverage.
Broad Form Collision Coverage
- If you are MORE THAN 50% at fault for the accident, your insurance pays, except for the deductible that you have chosen. You are responsible to pay for your deductible.
- If you are 50% OR LESS at fault for the accident, your insurance pays. You do not have to pay your deductible.
Standard Collision Coverage
- Regardless of who is at fault for the accident, your insurance pays, except the deductible you have chosen. You are responsible to pay your deductible either way.
Limited Collision Coverage
- If you are MORE THAN 50% at fault for the accident, your insurance pays nothing. You are responsible for the cost to repair your vehicle.
- If you are 50% OR LESS at fault for the accident, your insurance pays. If you have selected a deductible, your insurance will pay for the cost of repairs, less the deductible. You are responsible to pay your deductible.
No Collision Coverage, (PLPD, Liability Only Coverage)
- Your insurance will not pay anything for vehicle damages. You are completely responsible for the cost of repairs to your vehicle.
A good insurance advisor will consult with their clients to select the type of auto insurance coverage that best meets their needs and budget. Ask questions and make sure you understand what type of coverage response to expect in the event of a claim. Contact Brown & Brown of Detroit for a comprehensive insurance review.