Collision insurance pays the cost of fixing or replacing your car after an accident-regardless of who was driving or who was at fault.

If the accident wasn't your fault, your insurance company will try to collect from the other driver's company. The payment you receive is limited to your car's actual cash value, minus your deductible. Actual cash value is the retail price of a car like yours before it was damaged. If you pay more in insurance premiums than you would get if your older car were totaled, you can save money by dropping the coverage. On newer cars you can reduce your premium by increasing your deductible. This coverage may not be required by law in your state. However, lenders usually demand collision insurance. Talk to your insurance agent to determine what is best for you.