View Full Version : Should I cancel collision insurance?

02-18-2005, 10:41 AM
Hi - I just paid off the balance of my car loan using my tax refund. Its a 1998 Saturn with 112,000 miles. Should I keep the collision insurance or cancel it? What is your budget recommendation?

Also, will that impact coverage when i rent a vehicle? (Ialso use either a platinum visa/mc or AMEX for coverage).


02-18-2005, 10:51 AM
I would never recommend to someone else on that decision but you can go to kbb.com (kelly blue book) and get an estimate of what your car is worth to help you make that decision. My father in law dropped his collisiion once the value dropped drastically.

02-18-2005, 10:54 AM
Ask them what they would give you if the car was totaled. See if the premium cost for that covereage makes sense given what they will give you and your deductible. Often around that age and mileage it makes sense to drop it, but you have to be able to afford the repairs (or downpayment on another car if totaled) on your own then if necessary.

Also check your cards for their car rental policies. Most have the coverage as part of their benefits, for up to two weeks anyway. Better to know ahead of time than be surprised!

Otherwise I would assume if you were depending on your insurance policy to cover the rental, that your policy would govern the terms. So if you dropped collision that could change things for the rental car too. Again your insurer can tell you as these things could also vary from state to state.

02-18-2005, 10:55 AM
i know its tough. the kbb value is $2000. So if i have a $500 deductable, the most i would get is $1500, correct?

02-18-2005, 11:13 AM
I am about to drop mine.

I have a 96 ford taurus wagon with 96,000 miles on it. It is costing me $700 a year with full coverage.

I just bought a 2002 Chevy Venture with 43,000 and its $600 will full coverage

We also have a 1980 chevy truck and we are charged $540

Go figure.. I am only paying $60 more for a newer fan with full coverage.

02-18-2005, 11:19 AM
i know its tough. the kbb value is $2000. So if i have a $500 deductable, the most i would get is $1500, correct?

Depending on the actual miles and condition of the car, this is correct. If you have an amount set aside for emergencies, in case your car was totaled, then it might make sense to drop the coll covg. keep the comp and liability covg no matter what you do. Comp is generally inexpensive compared to Coll, but is priceless if something unexpected happens.

02-18-2005, 11:41 AM
I carried collision on my 86 Subaru way longer than was probably smart, but every year when I looked at the breakdown of the bill, it just wasn't that much extra for the coverage. I finally dropped it when I decided the value of the car was about $500, which was also my deductible.

Compare the premium to the value vs the deductible and go from there.


02-18-2005, 01:20 PM
I would say after 6 years for an econobox car or after 10 years for a luxury car, drop the collision and comp.

Note that some car rental agencies reserve the right not to rent to you if you do not have collision on at least one of your own cars.

Disney hints:

tar heel
02-18-2005, 02:54 PM
We've kept collison on our older car b/c it's costing us almost nothing. It's the liability insursance that is so expensive. The cost of the collision, unlike the liability, drops as the car's value goes down.

02-18-2005, 03:18 PM
Last year we finally dropped collision coverage on our beloved 1993 Toyota Corolla wagon. It has 150K+ miles and runs like a dream (well, an old dream), but after deductible and blue book value, we decided it made sense.

j's m
02-18-2005, 05:45 PM
We were ready to drop it last year on my 94 Camry and DH's 93 Cadillac, but we were told by the agent that in NJ, they can charge you MORE for liability if you drop collision. So, we added it up, and decided it wasn't that much more. Of course, then we both had accidents last year (first in probably 15 years) so we were able to get them both fixed for $ 500 each. Otherwise, we probably wouldn't have wanted to spend the money to fix them, and would have had to buy 2 new cars with 2 new car payments. Yuck.