How Much Car Insurance Do I Need Reddit
My wife and I have two vehicles: (How much car insurance do I need Reddit)
- 2012 Mazdaspeed3 (fully paid off)
- 2015 Subaru XV Crosstrek (~3 years left on loan at a very low APR)
We have good driving records (no tickets/accidents), but live close to a high-COL area, so folks who live around us drive pretty expensive cars. We share an insurance policy and are the “primary” driver of one car each. Our policy is up for renewal soon.
What’s a sane level of coverage to have for each car? I do not know what are good amounts to be insured for in the following categories:
- Bodily injury
- Property damage
- Personal injury protection
- Uninsured coverage
Also, what’s a good amount to set deductibles to, assuming we have a healthy emergency fund?
How Much Car Insurance Do I Need Reddit – Answers
Take a read through the car insurance wiki page to get some ideas for what we generally recommend in terms of coverage.
Just wanted to mention so that you do not get into a sticky situation that the financed car probably has terms of coverage you need to carry for the life of the loan. So, do not try and get a policy with just liability coverage on that car because you will more than likely be violating the terms of your loan and they could slap more charges on you per month or take some other action.
Thanks! We are not looking to drop either vehicle to just liability coverage, as they are both fairly new, with not many miles, and no mechanical problems whatsoever. Not looking to replace either for a long time 🙂
You should do a break even analysis on different collision deductibles (as that’s usually the highest part of car insurance) and see how long you’d have to go without a accident to recoup the difference. (i.e. if your premium goes up $1000py to lower the deductible from $2000 to $1000 then you’d just need to go 1 year without an accident for it to worthwhile)
If you have the money to pay the deductible in cash and the break even is under 3 years then it’s usually worth it to go with the higher deductible.
I like to hold Liability/Bodily for the total amount of my assets – this component of car insurance is usually the cheapest, and the best “value for money” in case of a major accident where your house/savings could be on the line.
Thanks for the comment! Yeah, definitely have the ability to pay a higher deductible in cash. Mine is set to just $500, and I feel like that’s too litt for the benefit.
100/300/100 is a good amount of coverage. What I tell people is you want to have enough coverage to cover your assets. If you make six figures and sitting on a million dollars in mutual funds, you obviously want to have more coverage than $100,000. The idea behind this methodology is if you get into an accident and hurt somebody you want them to go after the insurance company, not you and your personal assets.
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