Is it Possible to Overinsure Your Car?

Is it Possible to Overinsure Your Car?

You want the best coverage for your car, but you don’t want to pay for any services you don’t really need. But how do you know? Here are some hints of where you might be overpaying and overinsuring your car.

Your Car is 5 Years Old or Older

If your car is at least 5 years old and worth $2,000 to $4,000 or less, you might want to reconsider having comprehensive and collision coverage. The reason being: it might cost more to repair your car in an accident than it is worth. Most people don’t realize that as their car ages, carrying comprehensive and collision coverage is unnecessary.

You are a Member of an Auto Club

If you have a AAA or similar membership and get services like towing and roadside assistance, you don’t need roadside assistance and towing on your insurance policy. Sure, it’s pretty cheap to add these services to your policy, but why pay twice? Choose one way and stick with it. Doubling up doesn’t get you double the benefits.

You Rent a Car

If you rent a car, the salesperson will pressure you into buying insurance on the car. However, if you already have comprehensive and collision coverage, don’t buy the rental car insurance. You’re already covered. If you cause an accident, your liability coverage will pay for the car damages and medical bills. Collision coverage will pay for damages to the rental car, and comprehensive will protect the car from fire, flood and other incidents. No need to pay for unnecessary coverage.

Coverage Amounts

While it’s debatable, getting the maximum coverage available may be overkill. Most drivers do well to have middle of the road coverage that ensures all damages and medical bills will be paid by their insurance. This is the most affordable way to go about buying exactly the coverage you need.