When Should You Drop Comprehensive Insurance?

by Petra CameronOctober 5, 2021,
When Should You Drop Comprehensive Insurance?

The standard rule of thumb used to be that car owners should drop collision and comprehensive insurance when the car was five or six years old. However, in recent years, this has become a more complicated question. 

Comprehensive covers damage from fire, theft, vandalism, etc. At the same time, collision covers damage from accidents with other vehicles or objects such as trees or guard rails (this type of coverage also applies if another person hits your parked car). 

So why would anyone want to continue paying premiums for such protection once their cars are getting up there in age?

There are many factors to consider before dropping your comprehensive coverage. You could save money by dropping your collision and comprehensive insurance at age five or six years, but it may not make sense if you have an expensive loan on the vehicle. 

Suppose you still owe money on your auto loan. In that case, it makes more financial sense to keep your full coverage until the loan is paid off in full because otherwise, you would be paying two premiums, one for the policy with reduced liability limits and one for full coverage.  

Additionally, if your vehicle is worth less than, it doesn’t make much financial sense to pay extra every month to get rid of a policy with limited value. On top of all that, even though most states require drivers carry only liability insurance, there are still several states where having both types of policies is required by law.

We suggest keeping collision and comprehensive as long as possible unless something specific about your situation requires canceling, like high mileage or significant depreciation.

To learn more about different types of insurances, visit Lakeville Motor’s blog section.

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