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With or Without Comprehensive, you make the callApr 28 '00 (Updated Jun 22 '00) Write an essay on this topic.We have two cars right now, one on lease, with comprehensive insurance, the other we own it, with just liability. Although both cars are fairly new (1999 and 1998), we only buy comprehensive when it's required by the lease or loan contract. I am not saying comprehensive insurance is useless. It's just that in our situation (both me and my husband are very good drivers with no record at all), comprehensive policy is never used, thus not worth what it costs to us. Liability is required for all the cars, so there is little saying about whether you should or should not have it. Comprehensive insurance, on the other hands, has many pros and cons depending on how you assemble your package. For example, one of the major point you have to decide when you buy comprehensive is the deductible. That is the amount of money you have to pay first before the insurance can pay anything every time you have a claim. To my knowledge, it can be as low as $250, and as high as $1000. And the lower the deductible, the higher the cost, of course. If you are a careful driver like me, you will find that most of the little damages you might have with your car cost very minimal comparing to the amount of deductible. In these situations, it's faster, convenient, and cost much less to just stop by an auto shop to get what you want and put it on yourself than filing a claim, not to say if the amount is below deductible, you don't even have a claim. My worst little damages came when one time our car window was broken by some bypasser randomly. It only took us $100 to replace that window in a hour, still way below the amount of deductible. I did have one mild damage to my car, I bumped into the car in front of me once at a red light, an accident small enough that we didn't call the police, and the other car was not damaged at all. But my front bumper and the hood needed to be replaced. Along with a few little alignment here and there under the hood, the bill stood at $1200. So you might say this is where I might need comprehensive. Negative. I still pay it out of my own pocket. The reason I didn't use comprehensive is that, well, first I didn't have comprehensive on that car. Don's laugh. Just wait till I explain to you why I removed comprehensive from that car. We had comprehensive on that car the first year we owned it, partially because we were still on a car loan. Then half year into that in a snowy winter day, my husband had a little accident with that car in a parking lot. He was very slow and carefully signaled to make a left turn to get into a parking spot, while another car from the other direction, probably didn't notice the left turn signal, trying to speed up to pass through. My husband was a little slow to realize the other car's intention. So even he braked, our car bumped into the front left side of the other car. I went into length here to explain the detail of this accident, just to let you understand that this is a minor accident, minor enough that the police came and said there was no need to record it, but this is something that could happen to any driver, even when you are very careful yourself. And comparing to my other accident, the effect on our car is completely the opposite. So this time the only damage visible on our car was a few scratches, not noticeable unless you look within a feet. But the other car sustain some damage to their front bumper and side impact. Although we didn't consider this was my husband's fault (since the other car was obvious speedy in a 10-mile limit parking lot, and the driver claimed not seeing our signal, which was still on after the incident), we agreed to let our insurance company to handle the case. To spare you from a length description of frustration of dealing with our insurance company, I will just say here that in a month or so, we learned that it was determined that we were equally responsible in this accident, that we need to pay half of the repair of the other car. And since our car was not damaged and we didn't file any claim, our insurance company just use the liability part of our contract to pay the other party. But as a result of all these, our payment on the car insurance will be raised soon, both on liability and comprehensive. That was when I decided to drop the comprehensive policy (of course I have to pay off the loan first). That happened about a year ago before the other more severe damage to our car happened (the above $1200 one). Am I regretted that I cancelled the comprehensive? Not even a little bit. If I stay on comprehensive, I would pay about $700 more in the past year for the comprehensive insurance. Then my comprehensive had a $500 deductible. You do the math, $500+$700=$1200. It barely balanced the bill. But then, since I have this new accident and file the claim, they are going to raise my payment again in the future. And from my previous experience, I know it's going to be at least another $500 more on the payment for the coming year. So now you tell me if it worths it. Here comes my point: you buy insurance, and you hope to use it when you have an accident. But when you really have one, you are lucky if they pay everything, but you can guarantee that they will raise your payment shortly after, and you end up paying the amount yourself, just in a different way. Or you are unlucky, either the cost is below the deductible, or you don't have comprehensive, but you are just paying it with the money that you would have already spent on comprehensive, and your payment for the liability part stays the same. I am still not saying comprehensive is useless. For when you are involved in a big accident, or someone gets hurt in the accident, comprehensive provides you the necessary power to sustain a big loss. But if you are a careful driver, and you don't usually drive in heavy traffic or on high way, and if you are like me, budget is a little tight and have to care about a few hundred dollars here and there, then I suggest you only buy comprehensive when it's required, and go for the highest amount of deductible it's required. When you have more money and have brand new cars, then think about comprehensive plan as a necessary, and trying to go for a balance between deductible and monthly payment. And one more thing, if you have kids that are just starting to drive, either you can convince them not to drive alone, or buying comprehensive for them even it's costly. This is one place you don't want to save money.  |
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