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Do I need collision insurance on an older vehicle?

This is a question that only you can answer according to your wants. However, purchasing collision insurance on an older vehicle may not be the most financially prudent decision you can make. An automobile depreciates every day. This depreciation is based on a variety of factors, including the mileage on the automobile and what sort of shape the body is in. If you carry collision insurance on an older car and are involved in an at fault accident, the insurance provider will only provide a monetary amount towards the repair of you car that is equal to the current value of the car. For example, let us say you own a twelve year old car whose Kelley Blue Book Value is only $1,400. If you maintain collision insurance on this vehicle for a year, you can very well pay in excess of that fourteen hundred dollars. If the car is involved in an accident, the insurance company will only pay you $1,400.00 despite what you might have paid in premiums.

Collision insurance is often mentioned in conjunction with comprehensive insurance. Comprehensive insurance acts as a supplement to collision insurance. Under comprehensive insurance, your coverage will pay the entire cost of your repair bill for property damages despite the circumstances of the accident. It also covers the costs of repair of property damage resulting from an "act of nature". Comprehensive insurance is a completely optional for of coverage; however, collision insurance is required by law if you have an outstanding loan on your vehicle. Both of these forms of insurance can be highly useful to motorists in the right circumstances.

Comprehensive insurance and collision insurance do come cheaply. If you own an older vehicle, it may be wise for to you carry only the minimum of liability insurance required by your state. The make and model of the vehicle that you drive is going to play a large role in factoring how expensive your car insurance premiums will be. A high end, luxury car is typically considered to be the most expensive sort of car to insure, as it is highly costly to repair. If you live in an area with a high crime rate, the insurance provider is going to assume that you are at a higher risk to be victimized by a crime, like vandalism. This will cause your rates to rise. Any accumulation of tickets or accidents on your driver's license record is going to cause your rates to rise accordingly. 

Before making any purchases, your best option is to seek out some price comparison online to weigh out the costs of comprehensive coverage from various companies. This will allow you to receive multiple quotes from different vendors on policies you may be interested in. Shopping around by using price comparison techniques can benefit you financially by allowing you to find the best deal. There are certain actions you can take to ensure you pay a low rate. Selecting a minimum liability plan for older vehicles can be one of these actions.


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