At What age do you switch to liability insurance on a vehicle?

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I'm considering switching to liability coverage on my truck in my signature. It still runs good. Etc but I've looked at the prices for diesel trucks and they've dropped substantially. I paid about 25k total for my truck and until a few years ago that's what it was worth still, but now I'm thinking insurance will probably only give me maybe 10k for it if it gets totalled.
 
Usually one drops collision when they deem they can replace the vehicle out of pocket and "not be sad". They think they won't total the vehicle (as a result of their own fault) for several years; and they will save the money not spent on collision insurance instead. Then if in case they do have an accident, that money they saved will be spent, hopefully resulting in either no loss or perhaps a net gain (if they went years without an accident). I spell this out with words and not numbers because it's very individualized. What's your threshold for pain? what can you afford to walk away from? The numbers are different for each of us.

Then there is the reality that you posted. A vehicle might be worth "lots" to you but the insurance company might not pay out nearly what you think it is worth. That is a reality check right there. True vehicle value should be kept in mind.

Me, I was going to drop collision on my newer Camry this past summer but after raising the deductible to $1k it was only a couple hundred to keep collision. I suspect its value is dropping below $5k so it's not worth having collision on--yet it's gotten really cheap for some reason. We're to the point where, if we were to total the car (say in a snowstorm) we'd feel ok with just walking away and buying a new car, thus it's not really worth having collision.
 
Just renewed all my policies recently. Went through the same questions with my agent. She said that based on the availability of parts to repair the truck and the cost, if something other than a fender-bender, they would total it out. Truck is worth about 4K, if that. I decided to just go with liability and dropped comprehensive coverage.
 
Yup. As long as you are willing to lose or repair your vehicle on your own dime, drop the insurance.
I have known a couple of people who regretted this decision.

Good luck.
 
Originally Posted by motor_oil_madman
I paid about 25k total for my truck and until a few years ago that's what it was worth still, but now I'm thinking insurance will probably only give me maybe 10k for it if it gets totalled.


If you can come up with the $10k, maybe so, but I would likely keep the Collision coverage. What does it run annually or semi-annually for it?

Too many people...not saying you're one of them...drop collision with the idea that "the other guy will pay for my vehicle if the other guy causes the accident." I get the idea, but that's only the case IF IF IF the other guy has insurance.

No matter that it's required, we all know of too many that don't have it. Good luck ever getting that $10k from someone like that. Court, schmort. It could take years.

Case in point, I had a 1977 Chevy C-10 pickup that my daughter's boyfriend was driving (authorized driver). He got rear-ended by someone else with no insurance. My carrier (State Farm) estimated repairs with used parts, at my request, so they would not total it. But I was responsible for the $1k deductible. I kept the truck and eventually sold to the BF.

A month ago I got a check from State Farm for the $1k 10 YEARS after the incident. They put the other guy on a payment plan to subrogate the total claim cost.

Long story, yes, but carefully consider the consequences.
 
I have never purchased collision/comprehensive auto insurance and it's been 45 years so I've probably saved over $25,000. Yesterday my 06 car was totalled as my wife hit a deer in the middle of the city [weird], so I'm out about $2,500. It's a gamble, you could win or lose. You have to weight the consequences. If a car repair expense would ruin you, then buy it.
 
After driving for almost fifty years with less than a handful of speeding tickets, I got one chargeable offense. Accident behind me, stopped traffic (pay no attention to helpful drivers that wave you through) and didn't know about an empty right turn lane. Had a witness say that she saw other driver pull out and accelerate when I got into the lane but as far as the cops were concern it was up to me to stay out of the right of way and they were probably right.

Got a drop notice from my insurance company and my broker informed me that it was one and out if you're a geezer. She couldn't fine any companies they carried. Original company later reinstated me-- have a FICO of 850, I'm glad they reconsidered.

Any way, after that I decided I would always buy low five figure cars from Hertz and count on walking away with the loss if I had a collision claim. Any accident, one or two car will probably result in me taking Uber until I die. I'm not going to lose my insurance because I drive into a ditch and make a one car claim.
 
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When the blue book value drops to around $ 3000 . The price for private sale .

That is about all I am willing to spend , out of pocket . Or when the cost of about 3 years of premiums = about that amount .
 
Originally Posted by supton
Usually one drops collision when they deem they can replace the vehicle out of pocket and "not be sad".



Good answer. If your truck were to disappear today would you be able to replace it without depending on it's private sale value, trade-in value, or totalled value? How much would you save a year by dropping collision? You could ask your insurance what the truck is valued at then you wouldn't have to guess.
 
I had a 98 Civic until this last January, when it was stolen. Comp on it (that covered me for the theft) was only $46/yr--it more than paid for itself. It was totaled out at $2000; I was paying that much yearly for 13 years. As others here are suggesting, I'd look at the cost of the various types of coverage before deciding that its just not worth it. Of course, I was also carrying collision on it as well.
 
It is personal finance situation. Eg if you are making consumer loan payments and have $1000 tops in the bank then never.

Even if your vehicle is only worth $4000 and you have $5000 in bank it would wipe you out nearly to get something similar. I would suggest keeping the insurance.

The other side of coin is the insurance buys you a ton of leverage and convince in an accident. You don't have to chase the other party or insurance in an accident. Your insurance company can be burdened with that and recover on your behalf.


In your personal situation do you have $10,000 sitting in hand + a ton more in emergency/life fund to cover it?
 
It may depend on one's financial position. My 2009 F150 4x4 is still very beautiful @ 140,000 miles. It may be worth $10K on the open market and $7K as a trade.

Clearly, the $1000 collision premium means I've paid $10K over 10 years. If I keep the vehicle another 5 years, that's $5K or closing in on the trade in value. In the next year, I'll drop the collision.
 
I don't go by age, I go by value.

My 72 442 carries full coverage because of the estimated $80,000 value.
My pickup carries full coverage because of the estimated $24,000 value.
My wife's Equinox carries full coverage because of the estimated $15,000 value, but that will get dropped in the next couple years as the value decreases.

The T is an entirely different animal since it falls under an agreed on value.
 
Bottom line is, cancel your collision and/or comprehensive whenever you can afford to or feel comfortable replacing the truck yourself.

You can give the money to your insurance company and be in a pool of people of which a very, very small of them will need a payout and the ins company greatly profits.
At the same time if you are one of the ones that needs that payout you will save a lot of money, however slim the chance.

Its like buying an extended warranty, its what you are comfortable with losing if need be.
 
My rule of thumb is value $10K or less, and 7 years old or older (the time when new OEM parts start to get hard to find). I would add, an uninsured motorist section on your car insurance for roughly $10K is a good idea too.
 
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