Under the personal auto insurance policy, damage is normally covered in one of the two following coverages.

• Collision: This coverage applies when the damage is caused by a collision with another vehicle or object. The damage is typically covered on an actual cash value basis - meaning your vehicle's value is determined by comparing your vehicle's condition to similar vehicles in your area. This valuation process can be complicated and most insurance companies use a computer program to assist them in determining the value of your vehicle. Bear in mind, this value can be negotiable. Always ask your insurance carrier how they determine this value and do your homework to ensure you agree. If you have a restored classic vehicle, you should seek a policy that is based on a stated value to ensure you get the true value of the car.
• Comprehensive: This coverage applies when the damage is caused by something other than a collision. This includes falling objects, fire, theft, explosion, windstorm, glass breakage, contact with an animal etc.

In most states both collision and comprehensive coverages are optional. Bear in mind, if you have a loan on your car most lenders require that you purchase enough collision and comprehensive coverage to adequately protect the lender.