When To Drop Collision Coverage (Forked River, NJ)

Do I even need to keep my collision coverage?

And the answer is - it depends. First and foremost, can you afford the cost of repairs or even replacing your car should it be a total loss? If the answer is no, then by all means keep the coverage.

Three quick steps to determine if collision coverage is worth it for you: Start with, how much are you paying on an annual basis for your collision coverage, add in the deductible. Compare that number to the value of your car using the private party retail figure on Edmonds or Blue Book. And remember, used car pricing is up 35% over the last three years!

Here's a quick example: Annual cost of collision coverage for a 2011 SUV (regardless of what kind it is), is $265. Collision deductible on that vehicle $1000. So after a year of premium, you would be out of pocket $1000 for the deductible and $265 for the coverage. Private party value for that particular SUV 2011 is $9000. So in this case, after a year we'd be out of pocket, $1,265. The car is worth $9000 - probably worth keeping the coverage. If the premium plus the deductible is say $2000 and the value of the car is $2500 ,well then there's a good reason to drop the coverage. Again, assuming you can afford the cost of the repairs.

We'd be happy to review your insurance coverage options with you! Give us a call at 609-971-8300 or visit https://sharerandassociates.com.