When Should I Drop From Comprehensive to Liability Coverage?

If you have a vehicle in New Windsor, NY, you already know you need car insurance. That said, not all insurance policies are the same, and if you’ve had your vehicle long enough, you might wonder if it still needs full coverage. This little guide from us at Windgate Insurance Agency Inc. can help you think about that.

Differences in Coverage

First, let’s be clear. The idea of dropping from comprehensive to liability-only coverage doesn’t have to happen simultaneously. You can step down coverage for the vehicle as it ages and certain coverage components start to feel superfluous.

Also, make sure to understand that liability-only coverage means that you get absolutely no compensation if your vehicle is damaged or stolen. Liability-only is what it sounds like. It only covers liabilities when you’re at fault in an accident. 

Lastly, liability coverage is required by state law. You can’t get rid of this coverage aspect, but generally speaking, it costs a lot less than comprehensive coverage.

When to Make the Change

Mostly, the decision comes down to money, and two situations justify a drop to liability only.

The first is when the value of the vehicle depreciates enough. If the car is only worth a few thousand dollars (or less), it might not be worth comprehensive coverage anymore. Your best test is to see how many months of insurance premiums it takes to equal the car’s total value. If you’re paying more than the car is worth in insurance every year, it’s time to lower your coverage.

The other situation is when another policy covers the vehicle. It doesn’t happen often, but you might get vehicle coverage through a job or a family member. There’s no reason to have two comprehensive plans on one vehicle.

If you think you might be in a situation that merits a change to your vehicle’s coverage, talk with your representative at Windgate Insurance Agency Inc. We can review your assets, existing policies, and specifics that might affect a New Windsor, NY, resident to help you make the best decision.