Current car is valued at $4k from NADA and similar cars online sell for around $6k. Savings of $500 per year in an semi-urban area if I drop collision and comp. Parked in a garage and I drive around 4000 miles a year as I work from home. I'm debating dropping collision and comprehensive but trying to see if there are any other benefits from keeping the car fully insured, are there any noticeable ones?
Opinions on dropping collision and comprehensive for 20 year old car?
byu/galacticphotos inInsurance
Posted by galacticphotos
7 Comments
Depends on how easy to would be for you to replace the car on a moment’s notice if it was wrecked. If you cannot do so without great financial difficulty, and you cannot be without a car for any period of time, then you’re paying $45/mo to be in the position of receiving a $4K+/- less your deductible check quickly if you total your car. Still leaves you having to come up with $2K + your deductible though. And if you have rental coverage on your policy, that would vanish if you dropped coll/comp. Might not be all that big a deal, but if it takes them a week or two to decide whether to total your car, that’s another few hundred at least out of your pocket. You’d have to check your policy to see how glass coverage comes into play.
If you can pretty easily come up with $6K to replace the car whenever you needed to, I’d drop coll/comp on a car where max payout is maybe $4K (depends on your deductible) and you’re paying $500 per year.
I once had a liability-only car wrecked badly enough to be irreparably undriveable. Nobody was hurt fortunately, but what sucked was being on my own to deal with the actual remains of the car, first getting it moved to a safe location to get our crap out of it, then figuring out how to dispose of it. The costs were not a big deal (and I actually netted a few hundred bucks of salvage value), but the hassle added greatly to the stress of the situation given that I started without the slightest idea of who even to call to deal with that. If I’d had collision/comprehensive then I think my insurer would have provided much more experienced coordination for that process.
One idea would be to keep the coverage but just set a four-digit deductible so it won’t cost much but the insurer will still be involved in a situation like that.
I’m in between cars ever since my Jeep crapped out, currently driving a 2007 temporary car. I don’t have collision or comprehensive, my insurance is around $40/month on this smaller econo-car for basic liability + renter’s insurance
If you feel fairly safe in your driving habits, go for it. Personally I like the money I’m saving by only getting the bare minimum I also live in a fairly safe area and drive mostly side-streets at low speeds, so ***for me*** getting the cheapest insurance makes sense.
You’ll have to review your own situation, driving habits, etc to determine if dropping collision/comprehensive works for you
To be honest, I had collision/comprehensive to the tune of $200+/month on my Jeep for 10+ years and only “used it” a whopping one time (…for a random hailstorm that caused ~$5k in dent damage) lol… in hindsight it was a waste of money
Can you replace the vehicle tomorrow if it was involved in a hit and run or hit by an uninsured driver?
at 4,000 miles per year, you should shop around and see who will give you a better discount! Insurance is there for a reason – to cover out of pocket expenses that you don’t have the money for. Insuring the car against loss makes sense, unless you have $6k in the bank to buy a new one if that one gets totaled!
I know someone who went to do this recently and when just dropping it the price really didn’t go down as much as they hoped they were quoted a savings of $10 a month.
Plus the carrier valuation is, unfortunately, often less than the 4-6k you see online (of course less your deductible as well..)
I’d also ask your agent how the No PD rate (-$500) compares to the savings for: “Highest deductible Comp with No Collision”.
This isn’t always the case, but, depending on your carrier, some actually give more of a savings WITH Comp vs w/o Comp…. and if you wouldn’t file a comp claim (better for your future rates; & you’ve already said you can pay for a new car yourself) then having the highest Comp deductible & no Coll could help increase those mean-time savings even more.
Lastly – Changing auto ins carriers frequently is not ideal for new rates (3yrs good, 5yrs best)… so if it’s likely you’ll be replacing your car within the next year or so, I’d actually WAIT to change carriers until you’ve bought the replacement. You’ll benefit more by finding the best rate once you have that longer-term vehicle vs shopping now… One carrier could offer a great premium on the 20 year old car but have horrible rates when you add “X” next car (and you won’t get as good of rates the second time you shop without building longevity first); So I’d adjust the current policy as needed, keep building longevity with this carrier, & timing your shopping after a car change to get the most bank for your buck.