Collision Coverage — Texas
Collision coverage pays to repair or replace your vehicle when you hit another car, object, or roll over — regardless of who's at fault.
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What Is Collision Coverage Insurance?
Collision coverage pays for damage to your vehicle when you collide with another car, a stationary object like a guardrail or tree, or roll your vehicle. It applies whether you caused the accident or someone else did, and it pays out even in single-vehicle accidents where no other driver is involved. The coverage pays up to your vehicle's actual cash value minus your chosen deductible, not the replacement cost or purchase price.
Who Needs Collision Coverage Insurance?
If you're still paying off a vehicle, your lender contractually requires collision until the loan is satisfied. Retirees who would struggle to replace a vehicle out-of-pocket benefit from collision even on older cars, as long as annual premiums stay below 15 percent of the vehicle's value.
Calculate your vehicle's actual cash value using Kelley Blue Book or NADA, not what you paid or what replacement would cost. Subtract your deductible from that value. If annual collision premiums exceed 15 percent of the net recovery amount, consider dropping collision and setting aside the premium savings in a vehicle replacement fund. Revisit the decision annually as vehicle value declines and premiums adjust.
How Much Does Collision Coverage Insurance Cost?
- Driving record — collision claims in the prior three years increase premiums significantly; a clean record qualifies for the lowest tier.
- Garaging location — collision costs more in Houston and Dallas due to higher accident frequency than in rural counties.
- Mileage — retirees driving under 7,500 miles annually often qualify for low-mileage discounts that reduce collision premiums by 10 to 20 percent with carriers like State Farm and Nationwide.
- Bundled discounts — combining collision with comprehensive and taking a mature-driver course can reduce the combined premium by 10 to 15 percent with carriers writing in Texas.
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