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Questions That Must Be Asked Before Purchasing Auto Insurance Collision Coverage in New Jersey

Physical damage covered under Auto Insurance in New Jersey comes in two categories. These are the collision and comprehensive coverage. These two forms of cover are similar as these come into play when your vehicle is damaged from an accident. The difference is that Comprehensive policy covers damages to the vehicle that are not as a result of an accident with another vehicle like fire, vandalism and extreme weather. On the other hand, Collision coverage provides cover for damage on a vehicle resulting from an accident with other vehicles, property or bad roads.

This thin line between these two forms of Auto Insurance in New Jersey covers sometimes causes confusion to potential clients. You may require the services of one form of cover and end up purchasing the other one. The problem is most individuals only end up discovering this when the time comes when the services of the cover are required. To avoid being trapped in such a scenario, make sure to have your insurance agent, broker or customer service personnel explain in detail the difference between the two covers. Two major questions usually arise when inquiring on Collision Coverage. These are:

•             How much will it cost to repair the vehicle?

•             In the event that the vehicle is totaled in an accident, how much will it cost to replace it?

These are the questions that you should ask your auto insurance agent before signing a contract for collision cover. Collision coverage in New Jersey is usually purchased according to the value of the vehicle.  This means that the collision coverage for the repair or replacement of your vehicle is not exactly what you used to purchase. It is the current market value considered in factors like depreciation, current condition and age of the vehicle. These same factors are also used to determine whether you require taking up Collision Coverage and also the rate of the premiums you will be required to pay.

Factors that determine whether or not you should take up Collision Coverage are heavily dependent on the ownership. If you have purchased a vehicle on loan or have leased a vehicle from a company, you will most likely be required to take up this coverage. This is so that the company which you have leased the vehicle or loaned from can cover themselves. On the other hand, if the vehicle is fully yours in that you have completed all the mandatory payments, taking up a Collision Cover is your own prerogative. In this instance you must put into consideration the condition of the vehicle and is value. If the vehicle is new, the value to repair it will be high. If the vehicle is old, the cost to repair it will be low. To get more information on Collision Coverage and comprehensive coverage, enter your Zip at the start of the page.