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Understanding Collision Insurance and How to Save Money

What Affects Collision Insurance Rates?

Collision insurance covers damage costs from a crash involving another vehicle or object. Several factors influence the cost of your premiums, including:

• Your driving record: A history of moving violations or claims can increase your rates.
• Your vehicle: The make and model of your car can affect your rates. Expensive cars typically have higher insurance costs.
• Your location: Living in an area with higher accident rates can result in higher premiums.
• Your driving activity: The number of miles you drive can impact your insurance costs.
• Age and gender: Younger drivers and males often pay higher premiums.

What Does Collision Insurance Cover?

Collision insurance covers damage your car sustains in an accident or collision with an object. It pays for repairs or replacement costs resulting from:

• A collision with another vehicle
• A collision with a tree, fence, or building
• A single-car accident where the car rolls over

However, collision insurance does not cover:

• Damage to another driver’s vehicle
• Damage your car sustains when you’re not driving it
• Medical care
• Theft

Do I Need Collision Coverage?

If you have a vehicle loan or lease, you likely need collision insurance as most lenders require full coverage. This protects their investment and your financial interests. If your vehicle is paid off, you can choose to drop collision insurance, but consider:

• Your car’s value: If your car’s value is low, the cost of collision insurance may not be worth it.
• Your financial situation: Without collision insurance, you would need to cover repair or replacement costs out-of-pocket.

How to Save Money on Car Insurance

Here are some tips to lower your auto insurance premiums:

• Increase your deductible: Higher deductibles can result in premium savings, but you’ll pay more out-of-pocket for claims.
• Reduce unnecessary coverage: Evaluate your coverage needs and eliminate any that are not necessary.
• Choose the right vehicle: Lower-priced economy cars generally have more affordable premiums.
• Scoop up discounts: Bundle policies, insure multiple vehicles, and ask your insurer about available discounts.
• Shop and compare providers: Compare policies from at least three providers to find the best coverage at the best price.

Don’t Forget About Your Credit Score

Your credit score can impact your insurance premiums. Check your credit report and score to identify any issues and take steps to improve your credit. This can potentially save you money on car insurance.

For any mortgage service needs, contact O1ne Mortgage at 213-732-3074. We are here to help you with all your mortgage requirements.

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