Make us your home page
Autos | Insurance

Assessing what car insurance coverage you need

Many of us find ourselves shopping for insurance with no idea of what we're about to do. No wonder people throw up their hands in frustration and just shell out as much as cash they can afford, and never review the policy again. Here's a guide to help you decide if you still need full-coverage auto insurance, along with a tips on reviewing your current policy. Kate Forgach,

Do you drive a car? You must have minimum insurance coverage as required by your state. Full-coverage auto insurance generally refers to a policy that includes comprehensive and collision insurance, in addition to the state minimum.

Have you paid off your car loan? Unless you have paid off your car loan, you won't be able to drop full coverage. You may play with the deductible to make this more affordable, but you do need full coverage until you've paid off your loan.

Do you already have auto insurance? After the purchase price, auto insurance can be the most expensive aspect of owning your car. Adjusting your policy can lead to substantial savings and more affordable auto insurance. It's worth reviewing your policy and comparison-shopping every year.

What is your car worth to you? Comprehensive insurance covers you if your car is stolen and not recovered, or damaged by anything other than a car accident (e.g. fire or flood). This will pay for your car to be fixed or replaced for the amount your insurance determines to be the car's actual cash value, minus your deductible. For a general estimate of your car's worth, consult the Kelley Blue Book.

What is your car worth to the insurance company? Get out your calculator and do the math on the last question. Look up your car's value in the Kelley Blue Book. Subtract your deductible. Don't forget to also subtract the amount of your car loan. This is what you will receive if your car is totaled.

What is your car worth to someone else? Before you decide to write off comprehensive coverage based on the results of your math, consider the 10 most commonly stolen cars in the United States are more than a decade old. So even if you drive an older car, if you can't replace the car yourself, you might want to keep your comprehensive insurance.

Are you a careful driver? Collision coverage pays for repair or replacement (minus your deductible) in case of a crash. Even if you're a safe driver, an accident may happen because of another car.

Is your car European, or an "old reliable" Honda or Toyota? In this case, it may not make fiscal sense to keep collision coverage because the price of parts could be through the roof. Damage to a single part can "total" a low- or mid-value car, even if it's otherwise drivable. A fender-bender could result in a total loss. Would it be difficult to buy a replacement with the Blue Book value, minus your deductible (and car loan if you have one)? Your money is better spent in saving for a new car.

Where does your car live? Urban drivers face many more automobile hazards than suburban or rural drivers. If you're carrying full coverage and do little or no city driving, consider changing your auto insurance policy.

Is your car new? A newer, more expensive car should carry full coverage. Just review your policy as the car ages. You may even have a point in mind to begin switching over from insurance to saving for a new car. Overall, the one that is best for you is the plan that will give you enough money to put you back on the road after a loss.

Assessing what car insurance coverage you need 04/27/11 [Last modified: Wednesday, April 27, 2011 4:30am]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item,

Join the discussion: Click to view comments, add yours

  1. Tampa is 15th-most popular city to move to with U-Haul


    TAMPA —Tampa is undoubtedly a destination point, at least according to U-Haul.

    Tampa is the No. 15 destination for people moving with U-Haul trucks. | Times file photo
  2. Florida's economy growing faster than other big states and far better than U.S. overall


    When it comes to economic growth, Florida's running alongside the leading states and well ahead of the United States as a whole.

  3. Westshore Marina District project takes shape with another acquisition

    Real Estate

    TAMPA — One of Tampa Bay's prime waterfront areas took another major step toward redevelopment Friday as WCI Communities bought 2.35 acres in Westshore Marina District.

    WCI Communities, Lennar's high-end subsidiary,has paid $2.5 million for 2.35 acres in the Westshore Marina District for 35 townhomes. WCI is under contract  to buy an additional 9.5 acres.
[BTI Partners]
  4. Posh Guy Harvey RV park to open in Tampa Bay with $250,000 cottages


    HOLIDAY — Love those Guy Harvey T-shirts with the soaring marlins? In the not too distant future, you might be able to kick back in your own Guy Harvey cottage in the first-ever Guy Harvey RV park.

    Renderings of the clubhouse and an RV cottage site of the planned Guy Harvey Outpost Club & Resort Tarpon Springs.
[Guy Harvey Outpost Collection]
  5. Port Tampa Bay secures $9 million grant to deepen Big Bend Channel


    Port Tampa Bay has secured a $9 million grant from the U.S. Army Corps of Engineers for the widening and deepening of the Big Bend Channel in southern Hillsborough County.