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May 07, 2015 (0) comment , ,

Our clients often ask what to consider when contemplating dropping full coverage on their vehicle. When insurance companies refer to “full coverage” they are including comprehensive, collision and liability coverage in one policy.

Liability coverage protects the other driver and their property if you are at fault for an accident. Collision coverage would apply in situations where your car is damaged during an accident or in a single-car accident (like running off the road). Comprehensive covers incidents that are not a result of a crash, but rather weather or vandalism related.

Establish the value of your car to see if it’s worth it to keep full coverage or not. If you own a vehicle that’s still worth a significant amount of money, generally over $5,000, comprehensive coverage shouldn’t be dropped from your policy. After a car is 8-10 years old, that’s the average timeframe to start looking at the financials for collision and comprehensive.

Before calling your insurance agent to remove comprehensive and collision coverage, you need to be sure you are “allowed”. Banks and lien holders will usually request that the loan owner carry full coverage until the loan terms are satisfied (until the car is paid for or until the lien is released)

If you’re hesitant of removing full coverage, and are generally a safe driver, consider eliminating just collision first. Another way to keep collision and peace of mind is to just raise your deductible. This will lower overall insurance rates while still keeping adequate protection.

Call your McLean Insurance agent to discuss and determine the best decision for your situation and family.

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