If you have collision coverage, your insurance company will likely cover damage to your car if you hit something. Collision coverage is optional, but it's a good idea to have if you drive a newer or expensive car. Even if you have collision coverage, your insurance company may only pay up to the actual cash value of your car. So, if you hit a deer and totaled your 3-year-old car that you paid $20,000 for new, your insurance company would only give you $15,000 (the actual cash value of the car).