There are a few things to consider when deciding between a "full coverage
" or liability only policy:
- Determine an estimated fair market value of your vehicle. While Kelley Blue Book may offer useful estimates, I recommend using NADA guide since most insurance companies use them to determine a vehicle's value at the time of a claim.
- Decide on a deductible. With older vehicles, choosing a lower deductible will help to maximize the value you would get for the car if it were totaled.
- Look at the difference in premium between a "full coverage" policy that includes the deductible you want and a liability only policy. If the amount of money you save in premium by going with liability only is not enough to cover or replace the vehicle if something happens then it's probably best to maintain comprehensive and collision coverage.
Consider that, if your vehicle were to be totaled in the next year and you pay $1062 in premium and a $500 deductible to file a claim, you would be paying only $1,562 to cover your totaled vehicle. Assuming that your vehicle's value is $6,200, you would ultimately be getting $4,638 for your car. A liability only policy would likely cost much less than the "full coverage" policy, but you would be faced with repairing or replacing the vehicle out of your own pocket if it is damaged. Keep this in mind as the vehicle's value continues to decrease. Once the premium amount and deductible get closer to the value of your vehicle then you should consider switching to liability coverage
; sooner if you can afford to repair or replace it on your own.