When to drop full coverage on auto insurance?

What strategies do people have for auto insurance?  I’m not sure when to stop paying full coverage (comp + collision).  I imagine it would involve starting a category for a new car?  Suggestions appreciated.

4replies Oldest first
  • Oldest first
  • Newest first
  • Active threads
  • Popular
  • When you have enough set aside that you could replace your vehicle with cash (maybe a lesser car, but one that would suffice), drop the full coverage.  Start throwing that savings into your transportation categories so, yes, you have more available for your next purchase. If you're not quite ready to drop full coverage, consider upping your deductible instead, to $1000 or $2500.  That could save you a ton, provided you would be able to meet it should something require you to do so.

    Reply Like
      • Khaki Storm
      • YNAB book topics online: https://support.youneedabudget.com/r/q5w48j
      • Khaki_Storm.1
      • 3 mths ago
      • 1
      • Reported - view

      palee agree! I'd add look for a middle ground. A couple years ago I leaned my insurance company has a middle ground between full coverage and limited. It is much cheaper than full coverage. It will not cover damage I cause to my car. However, if a deer hits my car, or a tree falls on it, things like that, then the car will be repaired or replaced. 

      Reply Like 1
  • My financial advisor's rule of thumb was when your premium for comp and collision is more than 10% of the value of the car. Even if you can't afford to buy a new, running car outright, at that point it makes more sense to finance an inexpensive used car if your car is suddenly destroyed (which is actually what happened to me.) 

    Put the savings from the premium in your "new car"  category. 

    Reply Like 1
      • HappyDance
      • YNABing consistently since 2014
      • HappyDance
      • 3 mths ago
      • Reported - view

      WordTenor 

      Thanks. That's a handy rule of thumb to make note of for future reference, as I'm pretty sure that I'm closing in on that number, 10% of my vehicle replacement valuation being equal to the difference in premiums between comprehensive and collision.

      Reply Like
Like Follow
  • 3 mths agoLast active
  • 4Replies
  • 104Views
  • 6 Following