When do you drop collision?

[99Saturn]

A couple of recent threads regarding accidents, purchase price, etc. have me thinking about collision coverage.

I'm curious what people use as their personal gauge for dropping collision coverage.

For example: Cost of Collision Premium is X% of the (Value of the car - deductible) = time to drop.
... or some other metric.

All replies welcome, I'm framing this question in my mind around the "average" commuter, though I know we all have a different definition of "average".

 

[JHZR2]

My parents and grandparents always dropped it pretty fast, primarily because it was historically cheaper for them to self insure (based upon premiums and tendency to get into accidents). Others may not have the same luck. I'm holding on more primarily because as car safety systems get more complex, it gets more and more $$ to repair.

 

[Silverado12]

I don't ever drop it. It's not that expensive.

 

[dparm]

Logic would dictate that if the car is worth less than what an average fender bender would cost (say $2000), then it's not worth it to have collision coverage.

A fender bender where you rear-end someone will likely smash your bumper, headlamps, hood, and possibly the radiator. That's $2000 easy.

 

[IndyIan]

There must be some ratio of the maximum amount you will get for the car vs. the premium, where it makes sense to drop collision.
I find with our insurance that they must lower the collision premium somewhat in line with what the maximum they will pay out, as collision and comprehensive are not very much, but I still cancel both when the car gets down to the 2-3k mark.
We've never made a claim ever, so based on that, I might as well save the $100-200 a year. I guess so far I could write off the Tracker and come out ahead with maybe 20 vehicle years without collision and comprehensive insurance as its a 2-3k vehicle.

 

[zzyzzx]

I dropped it on mine since the extra premium would pay for the value of the car that they would pay out about every 3 years or so. It's simply very expensive insurance.

 

[gman2304]

Years ago Consumer Reports advised...if the cost of comprehensive insurance is 10% or more of the vehicles value, then it isn't worth the cost of the premiums.

 

[Oil Changer]

I never drop it. The premiums get cheaper as the vehicle ages, so it's no big deal. If the cost of repairs exceeds the value (i.e. totaled), I want the full value, which for me is always pretty high since I keep my vehicles in good shape.

 

[DuckRyder]

This is such a personal decision with so many variables...

But in general if you can't afford to stroke a check for the car then I'd say you probably need collision...

Even if you can afford it, there still might be reasons to keep it for convenience such as not having to negotiate with an at fault company...

The one thing I will say is: understand the value of the car and the deductible.

 

[sasilverbullet]

I drop it when the value gets below what cash I have on hand to repair/replace it.

 

[BISCUT]

Don't forget to consider whether you are using a $500 or $1000 deductible. Premium is different!

I do not have collision on my hoopdie (95 Camry) and my premium is only $36x a year. Collision is about as much as the general insurance!

 

[dparm]

Here's how mine breaks down (rounded to nearest whole number, and I excluded the small stuff):


Liability - Bodily Injury / Property Damage 37%
Comprehensive Deductible 14%
Collision Deductible 42%



Depending on the vehicle, the collision percentage could go higher or lower. It varies based on the repair costs of the car, and even based on the accident rate of your given vehicle. Yes, they actually calculate premiums based on how often other owners of the same car crashed. If a bunch of 2011 M3 owners crash their car this year, my rates would go up!

There are ways to bring your insurance prices down, such as living in a safer town, having multiple policies, being claim-free, low mileage, higher deductible, etc. I run a higher collision deductible because I don't drive very often, but a very low comprehensive deductible because I don't want to get a huge bill if the car gets vandalized or something.

 

[Doog]

I have 3 daughters....I NEVER get rid of it.

 

[expat]

Consider, The insurance company has already calculated the odds, and overall, they don't want to come out at a loss.

I play the Odds.,

So, 1) I can afford to self insure what I drive.
2) My driving/accident history is better than most.
3) Minor damage to my vehicles can be fixed very inexpensively through people that I know. A minor 'Ding' I can live with.

I might get collision for the first year or two of new car ownership. That's all.

 

[itguy08]

When the car is under $4k would be my guess. IIRC collision on the wife's Escape is about $200 a year with a $500 deductible.

We'll most likely drop it in the spring. A 2003 Escape with 145k simply isn't worth much and if it were to get totalled we'd just get something to replace it.

 

[ARCOgraphite]

Murphy's Law dictates that you will have an "at fault" accident within one month of dropping your collision coverage

 

[supton]

I haven't gotten myself to drop it on mine. I think it's $363/year, and I know I won't get much. I just haven't been able to call and say to drop it...

 

[dparm]

Originally Posted By: expat
Consider, The insurance company has already calculated the odds, and overall, they don't want to come out at a loss.

I play the Odds.,

So, 1) I can afford to self insure what I drive.
2) My driving/accident history is better than most.
3) Minor damage to my vehicles can be fixed very inexpensively through people that I know. A minor 'Ding' I can live with.

I might get collision for the first year or two of new car ownership. That's all.



I'd highly recommend you look at replacement costs for a new car getting into a fender-bender. Bumper + paint = $1000, headlamps at $700+/each (especially if you have HIDs, auto-leveling, adaptive, etc). A seemingly minor accident can get north of $2000 very fast. The labor times on new car repairs are going up too.

As you said, you play the odds, but definitely know what a new vehicle costs to repair.

My collision coverage is only about $33/month, which I think is a [censored] steal considering that I am a single male <30 years old, no other vehicles, on a car that had a sticker of $75k just two years ago. If I rear-ended someone, it would be $4-5k just to get my car fixed...that's like 10 YEARS worth of collision payments. Granted, I am getting discounts for low annual mileage, multi-policy, and claim-free, but that's still dirt cheap. My deductible is $1000.

 

[ddombrowski]

My rule of thumb is to always insure what you can't afford to replace, not what is inconvenient to replace.

Having to buy a new car for 4K because yours is totaled sucks, but if you CAN afford to do it you'll probably come out ahead in the long run. Having to buy a new car for 30K is in the realm of 'cant' for most people. I usually drop collision when the car is worth around 8-10K or so.

One valuable lesson I've learned is that if you get a car repaired through insurance, the wheels don't stop rolling as it goes through the paint booth and you'll be done in 3 days if the insurance is paying for a rental. If you're paying out of pocket - your car is going to sit at the back of the lot for a month while everyone elses insurance agent 'expedites' their repairs.

 

[Pop_Rivit]

We drop collision when the vehicle is less than $15,000 to replace. Our vehicle rainy day/replacement fund will cover that quite comfortably. That being said, we haven't had a vehicle in several years on which we carried collision. We dropped it on our Outback sometime around 2009 when it was 3 years old and that's the last time we had collision on anything. The pickup, Elantra and Durango are all under (in some cases well under) the $15,000 figure as is the Subaru.

For the 4 vehicles without collision our annual insurance premuim is less than $1,000.