When do you decide it is okay to not have full coverage insurance on your vehicle?

Question

We are trying to save some money here. I work at home, use my car mostly to drive back to where I'm from (six hours), and that's about it. My car is a 2001 Honda, so is five years old... and I still have full coverage on it. How do you decide when you don't necessarily need all of that? and what do you think I should definitely have? (I have been in an accident a year ago when someone ran a red light and totaled my car... geico fixed it, but probably wouldn't have, but I begged them.. there was over $11,000.00 damage and I'm wondering if I hadn't had full coverage, what would have happened... ) Thank you for any information or thoughts

PS I don't ask this in cars because no one answers

Trinity, the wreck wasn't my fault, however the guy had no insurance that hit my car, i DID Have unsinured motortist coverage, which I would keep because I feel extremely confident in my driving capabilities that I wouldn't be the cause of an accident. I know that sounds silly to you guys, but like I said I hardly ever drive anyway. I will weigh the options.

Answer 1

If the car is old, then don't get full coverage.

Here's a list of insurances.
I would recommend collision insurance if you are a great driver otherwise keep the full coverage.


Types Of Insurance Coverage

Insurance policies can be confusing, and if you don't understand the different types of coverage, you may leave yourself financially compromised.
On today's sleek cars, a little tap on what used to be the bumper can cost you $1000. If the damage extends to a fender or hood you may be up to $2500. A solid hit in the front of your vehicle will set you back a minimum of $4000, and if the engine or drive train is involved your loss may exceed $10,000. Most new and late-model vehicle owners can't afford that kind of loss, so l recommend comprehensive and collision insurance for every vehicle I sell. If you finance a car through a bank or car dealer, the lender will require them both anyway. Car dealers cannot allow a vehicle to be delivered without first obtaining an insurance card that has the purchased vehicle's VIN# on it. Here's a list of the common types of coverage:

Bodily Injury and Liability - This mandatory coverage protects you in the event you cause a crash that injures someone. It also covers your legal defense if needed. Bodily Injury and Liability is made up of two amounts (eg: 100,000 / 500,000). The first limits the amount of medical payments to a single person per incident, while the second puts a cap on the total amount paid out to all injured persons per occurrence. I recommend the most coverage you can afford.

Car Rental - If your vehicle is in the shop for repairs resulting from an insurance claim, this coverage generally pays $15 per day for a rental car for up to 30 days. Good luck finding a rental car for $15 a day. Most sub-compacts start at $25 per day, with luxury models priced at $50 or more. In addition, severely damaged vehicles are almost never repaired in the first 30 days. I've sometimes had to wait weeks just to get a customer's car looked at by their insurance adjuster. Get the highest limits available; they only add a few dollars to most policies. They pay for themselves if your car is severely damaged and off the road longer than a month.

Collision - Collision coverage pays for physical damage to your vehicle caused by a collision. If you're judged to be at fault, this coverage pays to fix your car. If your vehicle is worth more than $4000, I urge you to get this coverage. Get a policy with a $250 deductible or less, if possible.

Comprehensive - This covers fire, theft, and damage from acts of God like ice storms, tornados, hail, and floods. It also covers you if your vehicle hits a deer or is vandalized. Another highly recommended coverage (get the $250 deductible) if your vehicle is worth $4000 or more.

Credit Insurance - Popular with dealers, unpopular with me. Pays off your auto loan should you die or become permanently disabled. Premiums range from $10 to $40 per month. I cannot recall a single instance of any customer using this coverage, and you can't be forced to buy it. If your impending death or disability worries you, check your coverage under life insurance or disability policies you already have. If you need it, your insurance agent can probably add it to your existing policy for a fraction of what the dealer would charge.

Full Glass - Comprehensive covers your windshield, because it's against the law to drive with a broken windshield in most states. But for the rest of your windows, you still have to pay your comprehensive deductible before they'll pay for any broken glass. Get this inexpensive (sometimes free) coverage, especially if you spend a lot of time at the mall or live and work in a relatively high-crime area.

Gap Insurance (Leasing Only) : Gap insurance covers situations such as the theft or totaling of the car, when you end up owing more on the lease than the car is worth. Standard insurance will pay up to the car's current value, perhaps even the replacement value. But if you owe more than that, you still have to pay the difference. Gap insurance will do this for you.

Liability - This mandatory coverage takes effect if you are judged at fault in a collision. It pays to fix vehicles or stationary objects destroyed by your car. Get the most coverage you can afford.

Medical Coverage - In states without no-fault, this covers medical expenses for you and your passengers, no matter who was at fault in the crash. Get the most you can afford. (similar to PIP)

No-Fault Insurance - Although some states still don't have this beneficial insurance, No Fault is mandatory in most states. It pays medical expenses for you and your family, the passengers in your vehicle, and any pedestrians you may injure in an accident. The insurance is paid out regardless of who was at fault. (It does not cover property damage of any kind.) The medical benefits of a no-fault policy are sometimes called Personal Injury Protection.

Out-of-Country Coverage - If you travel to Canada or Mexico on a regular basis, make sure your automobile insurance coverage follows you. It may be necessary to take out country-specific policies if your carrier won't cover you. You especially don't want to get in an accident south of the border without a good policy. I consider this mandatory for anyone traveling in our friendly neighbors to the north and south.

Personal Injury Protection (PIP) - The medical portion of your no-fault insurance policy. Get the most you can afford.

Towing - not necessary if you take my advice and get AAA Plus, which is a better plan with a multitude of benefits insurance-company coverage can't compete with.

Underinsured or Uninsured Motorist - Everyone should have this coverage, because it protects us from all the low-lifes who drive around with cancelled policies. In most states you have to show proof of insurance to register a vehicle. Some people, however, take out a policy for registration purposes only, then let it get canceled by failing to send in their first installment payment. Luckily many states are cracking down on these criminals, by requiring insurance companies to notify the state when an automobile policy gets cancelled. The state's DMV then revokes the registration of the non-insured vehicle and notifies the registrant that the plates must be surrendered at once. If the plates are not turned in, the state suspends the owner's driver's license and revokes the vehicle's registration. In order to get the license back or re-register the vehicle, a hefty fine must be paid for each day the vehicle was driven without tags and insurance. An uninsured motorist caught driving with a suspended license in a car with a revoked registration goes to jail. If they hit your new car they still go to jail, but no one pays for the damage they caused unless you have Uninsured Motorist Coverage. Underinsured Motorist policies pay for injuries up to YOUR policy limit when the other driver either has no insurance, or their minimal coverage can't pay for your injuries or property damage. Hit-and-run accidents are usually included in this type of coverage, but make sure you're covered for them regardless. I consider this mandatory coverage, although most states don't. Get the most you can afford.

Answer 2

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Answer 3

I have a 92 Honda Accord which I still carry full coverage and the highest liability on but that is because of my job and I have to drive my vehcle all the time. If I was to get a "work" vehicle, I'd drop the honda to liability only, because it would cost more to fix it than replace it or what ever. I had a 87 Monte Carlo SS. Only carried liability, got hit head on by a drunk, only 3000 dollars damage, I drove home, but they totalled it, because the car isn't worth the cost of fixing. So, if you think that it would not be fixable because of the age, drop the full coverage, they won't pay for it any way.but carry a high liability, just to be safe.

Answer 4

With you having just had a wreck, of course you are leery of having anything less than full coverage. I on the other hand, have only had it when we were buying a car because they required full coverage. How much will it save you? What are your chances of having another wreck? YOU have to weigh your chances against your finances. If it was me, I would drop the full coverage, but then again, I've never been in a wreck either.

Answer 5

I think you can get away with just liability if you can afford to get yourself another car. Eventually the difference in the payments will be enough to pay to buy a car, but if money's that short, you'd want to save the money you make in a separate account until you have enough to replace your car. Then you can use it for other things.

It'll take a while before you can use the money for yourself, but if there's no light at the end of the tunnel, it's a possibility.

And make sure you stick to it. If you think things are bad now, imagine what it'd be like if you lost your car.

Answer 6

With a car that old it would save you some money not having full coverage on it. But if you are to blame in an accident you would not have a car(if you totaled it)

Answer 7

First I am a bit confused. If you have been charged with no proof of insurance that is a fairly simple charge to overcome. In order to get no proof of insurance dropped all you have do is before your court date show that you had insurance at the time of the accident. From your account I would assume you had enough time from the accident until the court date to show that you had insurance which would mean then the only issue is failure to control a motor vehicle? Assuming you had insurance at the time then the company will investigate her claim and since she was not injured most likely she will get a minimum payout, at best. Now if you did not have insurance at the time and she is suing the company then they might try to charge her for filing a false claim. Alternatively they might simply reject her claim in which case she can turn around to sue you for it or since she was driving she could file a claim with her company. Legally speaking you are in a very difficult situation. If she sues you then you will have "come clean" about not driving otherwise you might have to pay a judgment. This could mean that you will be charged with making a false report to the police, perjury, or some type of charge relating to insurance including the possibility of fraud. However if she decides not to pursue the matter with you and only the insurance company then the issue is between the two of them. With that said the insurance company may do their own investigation in relationship to her claim and if they are not satisfied with your statements then they may peruse it further with you. My advice would be to speak to an attorney who would be better to advise you about your legal liability in this case.

Answer 8

There is always what if's so what you need to ask yourself is this the only place in our budget that we can cut back. If the answer is yes than you really have no choice especially if y'all need the extra money that bad. As long as the car is paid off there is not going to be a problem in having liability ins. Hope this is enough info. to make good decision.

Answer 9

Car is over 10 years old..

Answer 10

compared to the headaches and the money it could cost you in the end, I would keep full coverage, small price to pay for piece of mind, you know how fate happens at times, no sense in tempting it

Answer 11

When it's over 15 years old.