Auto Insurance — When You Really Don’t Need A Great Policy
It does make sense to get the most extensive auto insurance coverage in most cases. However, in some situations, it’s sheer waste of money…
Auto insurance is one policy where the law makes it mandatory that you have one even when it might NOT serve your interests best. If you find yourself in such a situation, all you need is the barest minimum.
I’ll show you an example and also show you how to do it without putting yourself at risk…
An old car with comprehensive and collision coverage won’t do you any good. The only exemption to this is if yours is a classic (But that’s another issue).
Insurers will calculate your car’s value at the time of a claim based on what is known as Kelly’s Blue Book. The painful thing about this “book” is that, for old cars, the value is too low. Therefore, your insurer pays you nothing or close to nothing notwithstanding how high and for how long your comprehensive or collision coverage was.
This means then that getting the most extensive coverage for your old car won’t do you any good.
Now someone may argue that you also need to protect yourself properly from liability claims. Yes, you need to. But there’s a better way to do it…
Get an umbrella policy. This will give you far more coverage from liability claims per premium dollar spent than the most extensive of auto insurance policies. Furthermore, an umbrella insurance policy will typically bankroll fully even the craziest of lawsuits and all you’d have to pay are very affordable premiums.
With $300 extra, you can only raise your liability coverage to $100,000/$300,000 (from $25,000/$50,000) if you are a 35-year old man living in a place like New York City. However, $300 will get you $1 million worth of coverage with an umbrella policy.
To sweeten it all, an umbrella policy will take care of any other liability claims arising from, say, your home (You’ll do well to get details from your agent).
That said, you must still get at least the minimum required by law. And since you just want to keep the law, look for the cheapest offers. That way, you’ll only pay for what you need — Staying law abiding. Just make sure you do NOT need to file claims for your vehicle before going with this option.
If you want to save even more without putting yourself at risk, take some time out to do extensive comparison shopping. Get and compare quotes from a wide range of reputable auto insurance quotes sites.
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