November 25, 2014
What is comprehensive auto insurance and when does it kick in? When should you consider dropping it? Why?
What is comprehensive auto insurance and when does it kick in? When should you consider dropping it? Why?
Comprehensive auto insurance is insurance that covers damage done to your car when it wasn’t being driven. You should drop it because it is very unlikely you will need it. The insurance is expensive and you would be better off investing the money you aren’t spending on insurance and if you car is damage you could spend that money on it and it.
Comprehensive auto insurance covers things that are out of the control of the driver or peoples hands for the most part. Mainly acts of nature such as hail, tree damage and hitting a deer. It covers things that are not covered by you other car insurances. You should think about dropping it when the deductible is close enough to the value of the car you would not be ahead after the payments of the premiums. You should think about this because you are spending money on insurance that may not pay out in the end when you have a crash. A $1000 car with a $1000 deductible will not pay out.
The last comment was Garrett not Brennan. lol
Error
You made a good stab at it Brennan, but older brother Garrett got this right. Let’s review.
Comprehensive coverage deals with those things that happen to you that really have nothing to do with collision (with another vehicle) or liability. Tree’s falling on the car, hitting a deer, fire, vandalism, etc. You must have it if you have a loan on the car. The lender will require it. You have a choice when you have full title over the car (loan is paid off). Then what?
Comment #2 above is spot on. Consider the deductible and whether the added premium costs are worth it. A general rule? When the value of your car (private party) is below $5,000, start considering whether comprehensive coverage is worth it. Dropping it will save you plenty of money each and every year, but you need to understand that you are on the hook if one of those issues happen to you on any given day during the year. This demonstrates the value of a high deductible and an emergency account that is set up to handle something like a deer hitting your car or truck.