By JOSH UNDERWOOD
Full coverage or no full coverage?
That is the question.
I had an old car that I carried full coverage on for the longest time. One day I decided to check to see how much I might save if I removed comprehensive and collision coverage. The saving was minimal, so I just left full coverage on it, thinking, “If I have an accident, at least I might get something back for it.”
Years later, I eventually removed comprehensive and collision coverage and have since sold the vehicle.
It’s a common question for folks, deciding if/when to carry full coverage.
The question to ask yourself is, “If I remove comprehensive and collision coverage on this car or truck, and it is later totaled in an accident, regardless of who is at fault, and no coverage is available to repair it, can I absorb that loss?” If your answer to that question is yes, then you are a candidate to go with liability only. If your answer is no, that you would not be able to absorb a total loss, then keeping full coverage on the car or truck would probably be in your best interests.
The other day here at Cook, Downing & Underwood Insurance in Glasgow, Ky., we had an insured report an accident where the other party was at fault. Our insured had liability only, and their car was totaled. The other party, it turned out, was uninsured. So, there was no coverage available for our insured’s six-year-old car. Very unfortunate, considering that if our insured had carried full coverage, they could have been compensated for the totaled car from their own policy.
Another insured was recently involved in a collision where the other party was at fault. This time, the other party did indeed have coverage. Our insured had liability only, but in this case, they will be able to access coverage through the other carrier.
One middle ground option is to remove collision coverage on a car while keeping comprehensive coverage. That means keeping coverage for things like fire, wind, hail, theft, flood, glass breakage or hitting an animal, but surrendering coverage for colliding with the likes of a car, tree, building, etc.
It’s always a gamble when you go with liability only on a vehicle. So, whenever you are thinking of reducing coverage or adding a vehicle with liability only, ask yourself the question, “If this vehicle is totaled in an accident, regardless of who is at fault, and no coverage is available to repair the vehicle, can I absorb that loss?”
If you align your vehicle coverages to your answer to that question, it might save you some heartache.
(Josh Underwood is an independent agent at Cook, Downing & Underwood Insurance in Glasgow, Ky., “The Friendliest Agency in Town.” You can contact him at 270-651-2194 or [email protected] for your insurance solutions, including auto insurance, home insurance, business insurance, motorcycle insurance, boat insurance and life insurance.)