subject: Why You Might Want To Consider Dropping Collision Insurnace [print this page] Collision coverage is something that can add to the value of your car insurance costs. If you have an old car you should consider not using this type of coverage if you want to have more affordable auto insurance. Collision insurance on older cars does not always make sense for everyone.
Let's discuss:
To get a better idea of why this is something up for consideration, we first need to understand what collision coverage actually does for you. For damage to your car during an auto accident collision insurance will cover the cost. If the costs to repair your vehicle are lower than the collision insurance coverage, or the value of your car according to KBB is lower the damages will be repaired. And if your car is totaled you are covered as well.
When you have an older car however, the value of that car will more than likely be much less than what you bought it for. For example, according to the KBB a 2001 Chevrolet Malibu will be close to $4,500 in value while a 2001 Volkswagen Golf can be around $5,600 in value. These are values that are much less than what one would have paid for one of these cars when they were first introduced into the marketplace.
If your car is new then it probably makes perfect sense to add collision coverage. However, if your car is at least seven years in age or older collision coverage make not be right for you.
Furthermore, if your aged car was damaged in a major accident you may as well end up getting a new car anyway because the damages far outweigh the actual worth of the vehicle. The declining level of support for older vehicles these days when compared to what is being handled with newer ones make dropping collision coverage a good idea in order to make auto insurance more affordable.
If you can rid this coverage on your current older vehicle it makes spending more money much easier on the little things that may go wrong with it. Motorists report savings of up to $300 per year when they simply eliminate collision insurance from their policy.
Currently there are not any states that require motorists to carry collision coverage. Once you have done this with your policy you may have just taken a pricey monthly payment, and turned it into a cheap car insurance plan.
