The Real Cost Of Comprehensive Auto Insurance


Purchasing a new car, and shielding it with comprehensive car insurance is reasonable. This will give you the total protection above anything else in case something unpleasant happens. The only problem is that most people stop thinking about it if their insurances are deducted automatically, say through their checking accounts. Since, the worth of the car depreciates each year, the end result would be, that they are paying more than the car’s worth.

Understanding Full Coverage Auto Insurance

As the name implies, full coverage means you are protected from any kind of loss, regardless of who is at-fault during the accident. The insurance company doesn’t care who and what happened during that time, so to speak. Vandalism, theft and fire protection are covered in contrast with, for example, collision coverage that covers only head on collisions or some other types of insurance coverage, which are very specific in nature.

Keep in mind that most insurers will not pay you if the cause of the accident is classified as “Acts of God” such as flood, earthquakes, hurricane or war. Damages brought about by domestic war or violence is usually covered by your homeowner’s insurance. If you are unsure, ask your homeowner’s policy insurer just to be sure.  On the other hand, collision coverage will take care of you if your car is damaged in a road accident. It’s as simple as that.

It’s illegal for anyone to drive without carrying the state’s minimum liability insurance. Each state has its own minimum structure, that will cover bodily injuries and property damages.  This is where most people have failed to realize, and that is continuing to pay for comprehensive policy, even if they no longer need it. Year after year, the vehicle’s value is reduced, which makes it a good idea to reduce the coverage as well. People may not realize that full insurance coverage may not be the appropriate coverage, cost wise.

When Is the Right Time to Stop Using Comprehensive Insurance Coverage?

You are probably asking yourself right now when to stop using comprehensive insurance coverage. Here are some points to consider. If your car is five years or older, have the time to check the car’s market or real value. There are online facilities, and resources you can use to do this, otherwise, contact your insurance agent for assistance.

As soon as you have this value, compare it to your annual insurance cost. If it turns out to be less than ten times, ditch the comprehensive insurance otherwise, keep it. If the car is ten years, and older and your deductible is more than the car’s value, is also a good indicator to stop using it for good, and find another one.


When to Keep Comprehensive Coverage

There are times that keeping comprehensive coverage is far more advantageous than ditching it altogether. For instance, owning one of those “classic” or “antique” cars you consider priceless. However, if you want a real protection, ask your insurance provider if such coverage is applicable to your vintage units. Most insurers will need additional requirements for insuring such vehicles, stringent ones to be exact, which will determine how, and who are authorized to use it.