I am asking for advice as to whether I should remove collision
coverage on my 1998 Civic DX coupe that has 156,000 miles on it. I
bought the car brand new 10 years ago.
If I remove the coverage, it would save me approximately $20/month.
Kelley Blue Book states that the trade-in value of the car would be
anywhere from $2,000 - $3,000, depending on the car's condition. I
would say that my Civic is in-between fair to good condition. It
still runs good and I have kept up with it maintenance-wise.
Thanks for your advice,
If the annual cost for collision and comprehensive insurance on your
car is more than 10% of what you'd get from your insurer, then it's
time to consider dropping them.
Say the car is worth $3,000 & your deductible is $500. Then your risk
(exposure) is $2,500. If your collision premium is $250 per year,
then the rule of thumb says to drop the collision coverage and bank
the $250 for the next car.
(see more at
I have a 1997 Civic EX coupe with about 75k on the odometer and I
dropped my collision and comp coverage based on how badly I was screwed
in my last car wreck. The blue book on the totaled vehicle was 26k and
my insurance company gave me close to 19k for it.
When my agent tried to sell me insurance on the 1997 Civic, he was
pushing for me to add comp and collision. I flat out told my agent, why
should I pay you an extra $400 per year for a car that you will just
total after a mere fender bender?
This was my line of thinking. Why should I pay an extra $400 for
insurance plus a $500 deductible for a vehicle that I would be lucky to
get $2,000 for if my insurance company were to total it?
Maybe someone can shed some light as to if my line of thinking is
Also, uninsured motorist property damage will pick up damage to your car
as long as it is not your fault. Deductibles apply of course...
And maintaining comp is a good idea. Just one deer strike can ruin your
Insurance is for things that you can't afford to replace, like a new car
or a house. While it is a lot of money, losing $2500 for a car ($3000 -
$500 deductible) should be something that most people can afford.
Your thoughts are correct. Chances are that in five years, your car
won't be in a crash where having the insurance will make a difference
(don't forget, if you're in a crash and another party is identified and
responsible for the crash, that party is responsible). So chances are
that after 5 years, you'll $2000 + interest in the bank. On the other
hand, if you do get the insurance, in 5 years, you'll have the canceled
Don't forget, the reason why the insurance saleperson wants you to buy
the insurance is that the insurance company make a profit and the
insurance person a commission. Insurance companies make a ton of money
of the policies. In the long run, you're probably much better off
keeping the money. After 5 years, you'll have $2000 to help pay off the
collision coverage means that if you have any reported collision, the
insurance company owns your car, and they write it off. you get a check
for "fair value" and no car. and "fair value" isn't much.
if you "insure" the car for collision yourself, /you/ get to decide
whether the car gets written off. if it's a minor event, you can afford
to pay the repairs and keep the car running - you wouldn't have that
option with collision coverage. if it's major, you go buy a new car and
sell the crashed one for parts.
oh, and if you /do/ pay for crash repairs yourself, it's usually a lot
cheaper than an insurance repair. you know, cash, beer, barter, etc.
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