Collision coverage is optional in Maryland, but your auto loan lender may require you to have it. No, collision insurance is not required in Maryland because it is an optional type of coverage in every state. Although Maryland doesn't require it, your lender or landlord may require you to have collision coverage to pay for the repair or replacement of your vehicle after collisions with other vehicles or objects while driving. It's important to keep in mind that the maximum amount you'll receive from your insurer for a collision claim is the value of your car when you crashed it, not when you bought it.
Lenders often require collision and comprehensive insurance, in addition to the insurance you must have under Maryland law to finance a car. Uninsured coverage pays for your medical bills and damages if you have an accident with a driver who is at fault but doesn't have car insurance. Adding collision insurance will make your policy cost more than if you only had the liability coverage required by your state, but collision insurance is still a good investment for many drivers. Collision insurance covers repair or replacement costs if you have an accident, hit an object, or roll over your car.
Learn more about when to cancel optional coverage and penalties for driving without insurance in Maryland to make sure you're paying for the coverage you need. In some states, your vehicle can be towed and you won't be able to claim it until you present proof of insurance. The Maryland Auto Insurance Fund (MAIF) offers auto insurance to Maryland residents who have been rejected by two insurance companies or canceled by one. You should take out collision insurance if your lender or landlord requires it, if you can't afford the cost of replacing your car if it breaks down in an accident, if you drive in high-traffic areas where your car is likely to be damaged, or if you're often at fault for accidents.
Comprehensive insurance covers repair or replacement costs if your car is damaged by falling objects, natural disasters, floods, fires, theft, vandalism, or animals. Some car insurance qualifying factors, such as your driving history, can significantly affect your insurance costs. Keep in mind that most insurers will also require you to take out comprehensive insurance if you take out collision insurance. Maryland allows you to show proof of insurance on your phone, so download your provider's app ahead of time.
Not having car insurance in many states can make you a high-risk driver when buying car insurance. To see how much collision insurance costs depending on your specific circumstances, check out WalletHub's car insurance comparison tool.