Comprehensive car insurance is the “Bentley” of insurance coverage. It’s the gold standard when it comes to protection across a variety of issues that can befall you or your vehicle. But not everyone needs this comprehensive coverage on their vehicle. Some cars and their owners benefit more from a lower level of coverage because the premium for such a “premium” product outweighs its benefit.
Insurance is a must. It’s government-mandated, and even though road collisions and deaths as a result of a car accident are on the decline, it’s still an important consideration to make when weighing your options for different levels of coverage. Taking into account your car’s value, driving needs, and driving record are all great ways to make the best decision in this realm.
What does comprehensive coverage include?
Comprehensive car insurance covers essentially everything — hence the comprehensive component in its name. A comprehensive insurance plan gives the owner protection against theft, flood, fire, and vandalism, as well as injury and collision coverage. With this plan, auto insurers charge the highest premiums, but the deductible is often low and you gain a unique peace of mind in knowing that you will be covered, no matter what happens to your vehicle while out on the road.
How old is your car?
Insurance companies often set their pricing and deductibles based partially on a car’s age. If your car is older, the payments for comprehensive coverage may be higher than a similar plan for a newer car. Likewise, those who drive older cars are risking a lower value asset as they commute through the streets. This means that their insurance needs are actually reduced, and considering comprehensive coverage options may not suit their best interests.
If your car is more than ten years old, it may actually benefit you to pay the lowest possible rates and simply set aside cash every month to pay out of pocket for a new set of wheels in the event of a total loss. This is because the appraisal process takes into consideration the age and mileage of a vehicle in order to deduce its actual cash value at the time of a car accident.
Many vehicle owners with full coverage are surprised to find that their insurance policy is only going to pay out 60-70% of the cost of a similar replacement model. Instead of pouring money into an insurance plan that won’t help your particular circumstance, you can downgrade and save the difference for that inevitable rainy day.
Will you be taking some time away from driving?
Drivers who commute long distances every day benefit from additional coverage more than sporadic drivers. But there are others who may need this level of coverage for a time, but find themselves not driving in the present, and therefore the addition of compulsory collision coverage as an extraneous expense. If your loved one has been arrested, for instance, they won’t need any car insurance during this period. In order to reduce the bill, you will need to learn the proper procedure to write a letter to someone in jail and get their consent to change their insurance policy.
Likewise, someone recovering from recent surgery to repair an ankle or knee blowout won’t be driving again for weeks or months. Bumping down the coverage level during this downtime is a great way to save some money on an expense that you aren’t going to be using.
Choosing the right level of car insurance coverage is a tricky question to answer, but with a thoughtful introspection about your driving habits and coverage needs, you can rest assured that you’ll make the right choice.