We find ourselves in these difficult economic times trying to save some money. This could include switching to cheaper brand-name english muffins or looking for more affordable car insurance. While we don’t want to put our safety at risk, it is possible to reduce your collision coverage to save money on car insurance.
Let’s start by clarifying what collision coverage is. Collision coverage is, in essence, what covers your vehicle for damages caused by an object or vehicle striking it. This less expensive car insurance might not be necessary depending on a number of factors which we will discuss.
Are you a driver of an older car model? Collision coverage might not be necessary if you own an older model car. A higher deductible can make car insurance policies with collision coverage more affordable. For example, if your deductible is $1,000 (the amount you pay out of pocket before insurance kicks into), but your car’s total value is $2,500, then that $1,000 could have been better spent on something else, such as a new car. The deductible payment you make for collision insurance may be more than you realize. Do the math to determine if you are better off with affordable car insurance.
Are you a proud owner of more than one vehicle in your household? Consider dropping collision coverage for one car if you and your partner drive cars daily. You are likely to drive more frequently or in heavily populated areas. It is a good idea to keep collision coverage on the more used or frequented vehicle. If you only use one vehicle, such as to go to the post office or country store, collision may not be necessary. You can get cheaper car insurance for at least one of these vehicles.
Are you a resident of an urban area? Consider dropping collision to get a metro pass if you live in an urban area. Because these areas are more crowded, it is harder to find affordable car insurance policies that cover urban residents. Also, the risk of theft, accidents and fraud are higher in these areas. If you park on the street or use your car daily, it is advisable to maintain collision, but if your car is more of the weekend-get-away-type, and is safely parked in a garage, collision may be an unnecessary expense preventing you from securing more affordable car insurance. Walking may be a great way to save gas and burn some calories.
Are you leasing or owning your vehicle? Leasers or those who owe a large amount on loans will be exempted from this requirement. You must also maintain collision coverage to ensure that your loan officer or car dealer does not become liable for a huge repair bill. Even if it means you have to make higher monthly payments, focusing on your car ownership as soon as you can is a good idea. This will allow you to decide how affordable your future car insurance. Although the economic freedoms that come with full ownership might seem daunting at first glance, it is a smart course of action to save money in the long-term through more affordable car insurance.
Consider these factors to help you get more affordable car insurance if you are like many people who count every dollar. Protect your investment with wisdom, but don’t over commit.
