WalletHub - Ask the Experts: Comprehensive Insurance
Ph.D., CFP®, Financial Planning Program Director, Dr. Mary Jean Scheuer Endowed Professorship; Associate Professor, David Nazarian College of Business and Economics, California State University, Northridge
How should drivers pick their comprehensive insurance deductible?
Pick a large number and save the difference. There is no one for someone to have a $500 deductible when you can have a $1k and save the difference. Price your insurance with both umbers, see how much cheaper it is with a 1k and save the difference into a savings account. As long as you can afford the deductible in a case of an accident, you are most likely better. The probability of you having an accident (and having to pay the deductible) is most likely smaller than the savings you will accumulate. The key is to make sure you actually save the difference and have $1k available in case of an accident.
When should drivers drop comprehensive insurance?
Is your 1998 Corolla worth anything? If not, you can probably drop it. As long as your car is worth something, keeping the full coverage probably makes sense. I still remember my first car, a 1998 Nissan that I paid $1.5k for and a year later totaled. The insurance sends me a check for $2.2k. I would say that was a good bet.