When to drop collison?

[JEDI]

2005 mazda3, 100k miles, $4.9k kelly blue book trade in.
collision = $160/6months

i've heard 'drop collison when you can afford to eat the loss.'
pffftt.. then i shouldnt have bought collision in the 1st place.

is there a ratio of car premium to trade in value or something like that?

 

[bruceb]

Well, in your case it is $320 for 1 year of coverage and if you wreck it, it is still worth almost $5K .. keep it for now, especially if you are in an area with snow and ice as it still winter for another 3 months. Chances of damage are much greater in winter.

 

[SpatiallyAware]

At that cost, keep it

 

[Jumpem]

I never drop it. But I trade cars in at three years/100k miles.

 

[JulesMaximus]

I'm in the same boat as you with my Maxima. It is 8 years old, with 95k miles on it, and paid for, but it is worth about $6k and collision only costs me about an extra $300/year so I keep it.

 

[Bignate603]

At $300 a year on a car worth $5k I'd keep it.

 

[fbrdphreak]

The monthly cost difference between liability only and full coverage has never been very much for me, so I've never seen the point to dropping it.

I have 3 cars, 2 of them old enough to consider dropping to liability only (worth $3-4K each). When I priced my policy recently, I would have saved $15-20/month if I dropped to liability on BOTH of those cars. Certainly not worth it.

 

[kornphlake]

Collision on my car is like $90/yr so I kept it, even though my car is only worth $5k, and I can afford to replace it. The insurance is so cheap I feel better driving with the insurance, if I get in an accident it won't take $5k out of my savings to replace the vehicle. My other car is worth <$1000 and collision coverage cost a few hundred a year, I don't carry collision coverage on that vehicle because it's not worth it.

 

[ponyo]

2005 mazda3, 100k miles, $4.9k kelly blue book trade in.
collision = $160/6months

i've heard 'drop collison when you can afford to eat the loss.'
pffftt.. then i shouldnt have bought collision in the 1st place.

is there a ratio of car premium to trade in value or something like that?

Sure. So why do you still have collision? Sounds like you can't really afford to eat the loss.

 

[Viperoni]

It's a risk issue. I'd rather pay $320 to avoid possibly losing $5k.
If the car was worth $2k, that'd be a completely different story.

 

[JEDI]

It's a risk issue. I'd rather pay $320 to avoid possibly losing $5k.
If the car was worth $2k, that'd be a completely different story.

yeah but is there a rule a thumb?

like 15:1 car to premium ratio?
ie: car is worth $5k, premium is $300/yr -> keep
ie2: car is worth $4k, premium is $400/yr -> drop?

 

[alkemyst]

yeah but is there a rule a thumb?

like 15:1 car to premium ratio?
ie: car is worth $5k, premium is $300/yr -> keep
ie2: car is worth $4k, premium is $400/yr -> drop?

it comes down to if you wrecked your car without it, do you have ability to get to work?

if not keep it.

that's about the only math you need.

 

[jlee]

yeah but is there a rule a thumb?

like 15:1 car to premium ratio?
ie: car is worth $5k, premium is $300/yr -> keep
ie2: car is worth $4k, premium is $400/yr -> drop?

If you'd rather pay $5k to replace your car when you wreck it than pay $300/year for insurance, drop it. If you'd rather pay $300/year, then keep it.

It's your decision...you need to weigh the risk/benefit for your own situation.

 

[Sluggo]

We keep high deductibles (1k vehicles and 4k house) to keep rates down, and I always figure there is about a $1000-$1500 salvage value to a newer model car even in a worst case scenario. When I think about that and the cost of C&C insurance, somewhere around $6,000 is my break even point where we drop to deductible only.

 

[Black2na]

The monthly cost difference between liability only and full coverage has never been very much for me, so I've never seen the point to dropping it.

I have 3 cars, 2 of them old enough to consider dropping to liability only (worth $3-4K each). When I priced my policy recently, I would have saved $15-20/month if I dropped to liability on BOTH of those cars. Certainly not worth it.

This. i deal with insurance companies all day if its not gonna save you loads of money it really is worth keeping

 

[T2urtle]

If you'd rather pay $5k to replace your car when you wreck it than pay $300/year for insurance, drop it. If you'd rather pay $300/year, then keep it.

It's your decision...you need to weigh the risk/benefit for your own situation.

for me its not when I wreck it. its the possibly that a un-insured idiot or a hit and run that pops up. Or even an under-insured dumbo. Friend had a guy who hit him, he has some no name SR22. His insurance expired like 10 days before the accident. He doesn't have collision. Pretty much he is SCREWED. I think he is looking into sueing that guy but hell his car doesn't get fixed now so for now he is screwed pretty bad.

Being in a city like chicago, there are a lot of shady people then living in a small town, street parking could mean ANYTHING.