Car Insurance
When should you consider dropping comprehensive and collision car insurance coverage? Why?
When should you consider dropping comprehensive and collision car insurance coverage? Why?
When the value of your car gets below a certain number (let’s say $5,000), you would consider dropping comprehensive and collision coverage, thereby reducing your yearly premiums by quite a lot. Why? The insurance company will only give you what the vehicle is worth and before they do that, they will require you to pay the deductible if you were at fault in the accident and that deductible should be at $1,000 (high deductibles reduce yearly premiums).
$5,000 is an arbitrary number that I would use. You should think it through and make your own determination on what that number should be for you. Some of you might make it $3,000. Others may go as high as $6,000 or $7,000 as you weigh the probably vs. the possibility of crashing your car and totaling it. At the end of the day, it is your call, but understand that you have options and those options can save you a great deal of money!