Auto insurance can be tricky. You want ample coverage, but you don’t want to overpay for what you may not need. Everyone dreams of the perfect balance in which they pay the minimum while receiving maximum protection. When your car gets a little age on it, it can be tempting to peel back some of its coverage. There are some situations where dropping full coverage for your vehicle is a good financial decision, while in other cases, it may not be a wise idea. Here’s a closer look.

A Guide to Full Coverage Auto Insurance

What Does Full Coverage Include?

Full coverage insurance usually includes both collision and comprehensive protection. If you get in an accident and are determined to be at fault, your legally required liability policy will only pay for the other driver’s car. The purpose of full coverage is to protect you and your vehicle against the high costs of replacement and repair in a situation like this. Additionally, collision and comprehensive cover incidents such as fire, theft, vandalism, or weather damage. 

When Should You Drop Full Coverage?

If you have your vehicle paid off, you may be considering dropping full coverage from your auto insurance plan. Factors like your vehicle’s age, mileage, and value should all be considered when making this decision. One of the best ways to determine your next move is by using the 10% rule. If the annual cost of your insurance with liability, comprehensive, and collision is more than 10% of the replacement value, you can make a case for dropping everything but liability. However, this is always a risky endeavor. Accidents can happen, and just because you have a clean driving record doesn’t necessarily mean an accident can’t happen to you.

When Should You Keep Full Coverage?

If your car is on the other side of the 10% rule, you would have trouble paying for major repairs on your vehicle, or you would struggle to buy a replacement vehicle if an accident were to happen, it’s probably the wisest idea to keep your full policy. It’s ultimately up to you to assess what your car or truck means to you and what your situation would be like if you were suddenly without it. 

 

If you’re looking to purchase auto insurance for your car, truck, or SUV, turn to the experienced agents at Lafever Insurance Agency in Cookeville, TN. They’ll walk you through the entire process and help you choose a policy best suited for your needs. With over three decades of experience, they proudly provide affordable coverage options throughout Putnam County. They also specialize in high-risk motorists who may face difficulty getting a policy elsewhere. To speak with a friendly agent and request a free quote today, call (931) 526-3377.