What Is a Collision Deductible on Your Auto Insurance?

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A collision deductible is the amount of money to be paid by the policyholder for damages in the event of a collision. The insurance company pays the rest of the costs incurred due to the collision.

Collision coverage is car insurance designed to cover the expenses incurred by a driver who collides with another vehicle or with an object such as a tree.

An example of cost distribution for a collision is as follows: if $1,000 in damages are caused by a collision with another driver, and the collision deductible is $250, the insured person would pay the $250 out-of- pocket, and the insurance company would pay the remaining $750.