Author Topic: Saving on car insurance  (Read 970 times)

Catica

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Saving on car insurance
« on: January 17, 2019, 04:29:31 AM »
Hi all,

I just renewed my car insurance and that got me thinking about my coverage and cost.  My rationality is being clouded by frugality these days so I'm hoping someone can help me decide whether this is a wise idea or not.

My car is used on the weekends for fun activities, sometimes it might be driving 150 miles to go hiking, once or twice a year long weekend drive up to 1000 miles, maybe about 400 miles round trip to a theatre three times a year and every weekend just to do grocery shopping.  Once I a while hubby will drive it to work, maybe max 30 days total in a year.

Given the above circumstances is it worth going with the lowest coverage possible?  That would save me $340 a year.

Thanks

AlexMar

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Re: Saving on car insurance
« Reply #1 on: January 17, 2019, 06:37:04 AM »
High deductibles, yes.

Low liability coverage, maybe not.

I generally insure things catastrophic.  $1,000 in extra deductible is not catastrophic.  Hitting someones kid accidentally and being sued for $200,000 - catastrophic.

RWD

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Re: Saving on car insurance
« Reply #2 on: January 17, 2019, 06:45:14 AM »
I agree with not choosing the lowest liability coverage possible. Comprehensive and collision should probably be dropped once the vehicle is worth less than a few thousand dollars. I typically keep my deductible at $2k. Whether that makes sense for you depends on how much of a disaster $2k would be to your financial situation.

Monkey Uncle

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Re: Saving on car insurance
« Reply #3 on: January 17, 2019, 08:33:29 AM »
How many total miles per year are you driving?  It might be worth asking whether you qualify for your insurer's low mileage discount.  And any other discounts they offer, such as safe driver discounts, alumni association discounts, etc.

Also, I presume you have shopped around with a few other insurance companies.  In my experience, that is usually the best way to lower your car insurance bill without decreasing your coverage.

Catica

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Re: Saving on car insurance
« Reply #4 on: January 19, 2019, 04:31:38 AM »
Thank you all.  According to Kelley Blue Book, the trade-in value of the car is $960, private party value is $2900.  We drive it maybe $5000 miles a year.  Right now my comprehensive is $500 deductible, collision is also $500 deductible.

Monkey Uncle

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Re: Saving on car insurance
« Reply #5 on: January 19, 2019, 05:08:24 AM »
Personally, I would not carry collision and comprehensive coverage on a car that is worth less than $3,000.  If you have even the slightest accident, the insurance company will consider it totaled and will cut you a check for something close to the NADA book value.  But you'll have to consider your personal situation - how much you will save by dropping the coverage, and how willing and able you are to come up with the cash to either replace the car or repair it in the event of a wreck where you are at fault.

At 5,000 miles per year, you very likely are eligible for a low mileage discount.  If your insurance company does not offer such a discount, shop around to see if you can find a company that does.

RWD

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Re: Saving on car insurance
« Reply #6 on: January 19, 2019, 06:54:02 AM »
Personally, I would not carry collision and comprehensive coverage on a car that is worth less than $3,000.

Same here. The potential payout from insurance doesn't justify the cost.

Catica

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Re: Saving on car insurance
« Reply #7 on: January 19, 2019, 07:14:13 PM »
Personally, I would not carry collision and comprehensive coverage on a car that is worth less than $3,000.

Same here. The potential payout from insurance doesn't justify the cost.
But let's say I need a bumper replaced after an accident, wouldn't they pay the cost above my $500 deductable?

RWD

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Re: Saving on car insurance
« Reply #8 on: January 19, 2019, 07:31:36 PM »
Personally, I would not carry collision and comprehensive coverage on a car that is worth less than $3,000.

Same here. The potential payout from insurance doesn't justify the cost.
But let's say I need a bumper replaced after an accident, wouldn't they pay the cost above my $500 deductable?

Yes, up to the value of the car. So if the damage to your car is between $500 and $3000 you will pay $500 and they will fix your car. If it is more then they just total it and pay you $2500 (value of car minus deductible). $500-$3000 is a very narrow window. How much are you paying for comprehensive and collision?

BicycleB

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Re: Saving on car insurance
« Reply #9 on: January 19, 2019, 07:39:32 PM »
With liability only, you're likely to save more on premiums than they will ever pay.

Catica

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Re: Saving on car insurance
« Reply #10 on: January 20, 2019, 05:33:26 AM »
Personally, I would not carry collision and comprehensive coverage on a car that is worth less than $3,000.

Same here. The potential payout from insurance doesn't justify the cost.
But let's say I need a bumper replaced after an accident, wouldn't they pay the cost above my $500 deductable?

Yes, up to the value of the car. So if the damage to your car is between $500 and $3000 you will pay $500 and they will fix your car. If it is more then they just total it and pay you $2500 (value of car minus deductible). $500-$3000 is a very narrow window. How much are you paying for comprehensive and collision?
Comprehensive: $74.10 ($500 ded with non-ded glass)
Collision: $283.10 ($500 ded /waiver)
Explanation of Waiver:
Deductibles with the selection of 'WAIVER': the deductible will be waived for certain types of losses, such as if the auto was legally parked and struck by another auto owned by an identified person; the auto was struck in the rear by an auto moving in the same direction owned by an identified person; the operator of the other auto was convicted of operating under the influence, driving the wrong way on a one way street, operating at an excessive rate of speed, or any similar violation and you were not convicted of any of the same violations. Please see your contract for state specific coverage details.

Catica

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Re: Saving on car insurance
« Reply #11 on: January 20, 2019, 05:35:56 AM »
With liability only, you're likely to save more on premiums than they will ever pay.
If I go with liability only it would be $338.46 less a year.

RWD

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Re: Saving on car insurance
« Reply #12 on: January 20, 2019, 07:36:21 AM »
Personally, I would not carry collision and comprehensive coverage on a car that is worth less than $3,000.

Same here. The potential payout from insurance doesn't justify the cost.
But let's say I need a bumper replaced after an accident, wouldn't they pay the cost above my $500 deductable?

Yes, up to the value of the car. So if the damage to your car is between $500 and $3000 you will pay $500 and they will fix your car. If it is more then they just total it and pay you $2500 (value of car minus deductible). $500-$3000 is a very narrow window. How much are you paying for comprehensive and collision?
Comprehensive: $74.10 ($500 ded with non-ded glass)
Collision: $283.10 ($500 ded /waiver)

Is this per year or six month? I'm going to guess per year. The maximum payout you can expect from your insurance company is $2,500, so at $357.20/year you will exceed that amount in just 7 years. So unless you expect to total your vehicle more often than once every seven years or average a smaller ~$900 accident per year then you should drop the extra coverage.

Catica

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Re: Saving on car insurance
« Reply #13 on: January 20, 2019, 07:56:03 AM »
Personally, I would not carry collision and comprehensive coverage on a car that is worth less than $3,000.

Same here. The potential payout from insurance doesn't justify the cost.
But let's say I need a bumper replaced after an accident, wouldn't they pay the cost above my $500 deductable?

Yes, up to the value of the car. So if the damage to your car is between $500 and $3000 you will pay $500 and they will fix your car. If it is more then they just total it and pay you $2500 (value of car minus deductible). $500-$3000 is a very narrow window. How much are you paying for comprehensive and collision?
Comprehensive: $74.10 ($500 ded with non-ded glass)
Collision: $283.10 ($500 ded /waiver)

Is this per year or six month? I'm going to guess per year. The maximum payout you can expect from your insurance company is $2,500, so at $357.20/year you will exceed that amount in just 7 years. So unless you expect to total your vehicle more often than once every seven years or average a smaller ~$900 accident per year then you should drop the extra coverage.
Thanks, I'm going to drop it.  Would you change anything on liability:

Bodily Injury Liability $100,000/$300,000 $285
Property Damage Liability $100,000 $195.70
Personal Injury Protection Policyholder Only/$100 ded. $125.62
Medical Payments: Not carried
Uninsured Motorist: $50,000/$100,000 $11.40
Underinsured Motorist: $50,000/$100,000 $11.40

Gin1984

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Re: Saving on car insurance
« Reply #14 on: January 20, 2019, 09:11:14 AM »
Personally, I would not carry collision and comprehensive coverage on a car that is worth less than $3,000.

Same here. The potential payout from insurance doesn't justify the cost.
But let's say I need a bumper replaced after an accident, wouldn't they pay the cost above my $500 deductable?

Yes, up to the value of the car. So if the damage to your car is between $500 and $3000 you will pay $500 and they will fix your car. If it is more then they just total it and pay you $2500 (value of car minus deductible). $500-$3000 is a very narrow window. How much are you paying for comprehensive and collision?
Comprehensive: $74.10 ($500 ded with non-ded glass)
Collision: $283.10 ($500 ded /waiver)

Is this per year or six month? I'm going to guess per year. The maximum payout you can expect from your insurance company is $2,500, so at $357.20/year you will exceed that amount in just 7 years. So unless you expect to total your vehicle more often than once every seven years or average a smaller ~$900 accident per year then you should drop the extra coverage.
Thanks, I'm going to drop it.  Would you change anything on liability:

Bodily Injury Liability $100,000/$300,000 $285
Property Damage Liability $100,000 $195.70
Personal Injury Protection Policyholder Only/$100 ded. $125.62
Medical Payments: Not carried
Uninsured Motorist: $50,000/$100,000 $11.40
Underinsured Motorist: $50,000/$100,000 $11.40
I'd increase your un/underinsured motorist up to the $100,000/300,000.

Catica

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Re: Saving on car insurance
« Reply #15 on: January 20, 2019, 12:10:23 PM »
Personally, I would not carry collision and comprehensive coverage on a car that is worth less than $3,000.
 

Same here. The potential payout from insurance doesn't justify the cost.
But let's say I need a bumper replaced after an accident, wouldn't they pay the cost above my $500 deductable?

Yes, up to the value of the car. So if the damage to your car is between $500 and $3000 you will pay $500 and they will fix your car. If it is more then they just total it and pay you $2500 (value of car minus deductible). $500-$3000 is a very narrow window. How much are you paying for comprehensive and collision?
Comprehensive: $74.10 ($500 ded with non-ded glass)
Collision: $283.10 ($500 ded /waiver)

Is this per year or six month? I'm going to guess per year. The maximum payout you can expect from your insurance company is $2,500, so at $357.20/year you will exceed that amount in just 7 years. So unless you expect to total your vehicle more often than once every seven years or average a smaller ~$900 accident per year then you should drop the extra coverage.
Thanks, I'm going to drop it.  Would you change anything on liability:

Bodily Injury Liability $100,000/$300,000 $285
Property Damage Liability $100,000 $195.70
Personal Injury Protection Policyholder Only/$100 ded. $125.62
Medical Payments: Not carried
Uninsured Motorist: $50,000/$100,000 $11.40
Underinsured Motorist: $50,000/$100,000 $11.40
I'd increase your un/underinsured motorist up to the $100,000/300,000.
Thanks, I increased un/underinsured motorist.
« Last Edit: January 21, 2019, 06:46:14 PM by Catica »