@TwinTurbo I do apply it to the collision I carry on the vehicles we presently own. We have $1000 deductible. Back in 1970 when my wife and I were in graduate school, $1000 had much more purchasing power than it does today. We made enough to live on from the stipends from our graduate assistantships. We had our savings and an emergency fund of 1500 back then. Our 1965 Rambler was worth at most 700 and probably less. There was no need to carry collision on that car.
I need to be insured against big losses or financial ruin. I will absorb the small stuff.
Insurance companies give discounts for deductible because it saves paperwork. For example, my radio antenna was snapped off my Rambler while I was in graduate school. I bought a new antenna for $4.95 and installed it myself in 15 minutes. Had I gone to the comprehensive part of my insurance, it would have been recorded as a claim. I would have spent half an hour at least filing a claim. I would have had to take the car to some shop for a new antenna, which would involve more time. When I was a student, I didnāt have time to spare. I had fellow graduate students on the program I was on who started a year before I enrolled and were still there after I finished my degree.
I agree with your pointā¦
Would you believe the percentage is closer to 7.0%, nationally? And because itās an average the number could be lower, higher, way lower, or way higher depending on oneās particular locale. Some people go to extraordinary lengths to avoid having to purchase insurance, whether required by law or not.
At one time, in the city of Detroit, I believe it was closer to 50%. There were contact people who would help folks circumnavigate the insurance requirement. Iām not sure what that statistic is now.
CSA
Iām not the one who made the .1% claim. But yes I agreeā¦
Thereās a lot of people in NH who donāt have insurance because itās not required. āLive Free or Dieā. And then thereās the people who are under insured. These insurance companies are even advertising in MA about cheap insurance to cover the minimum liability.
Take the person to court or let your insurance pay for your repairs and they should then take that person to court. There is a law in canada that says people need insurance call the police jim
Well it was a year ago, the person that hit them had no insurance and them said he had only liability so no coverage for damage. Plus it was Texas not Canada. Calling the police might get the person a citation but not gonna get the car fixed. So answer is the same as a year ago to try and recover in small claims court. One thing though, you can take a loss off your taxes if you itemize but with the new standard deduction itās hard to get beyond it.
There may not be much you can do now, and others have covered the possibilities.
Years ago we learned this lesson the hard way, the at fault driver presented āproof of insuranceā that hadnāt been renewed, so no coverage. In subsequent accidents (there havenāt been many), if I couldnāt verify insurance on the spot with a call to the other partyās carrier, and if the amount of potential damage justified it, Iāve insisted that the police impound their vehicle (or detain them) until they produced the insurance, money, or posted bond. It can take some convincing to get them to do this, but usually gets results.
I would hope that the person who started this in Jan. 2019 has had this solved by now.
Considered and rejected . Just as you may rant about the Asian vehicle myth .
Hi Volvo! Volvos arenāt asian yet, right? Well, Iām glad you found the comments useful, anyhow, and you have a good evening! Tomorrowās another brand new wonderful day!
CSA
This is actually the level of insurance that I have, and I consider it adequate. My attitude is that one should pay to insure against risk that is likely to happen, not risk that is extremely unlikely to happen. While itās entirely possible that we could be involved in an accident with a $150,000 car, it is much more probable that weād be in an accident with a $1000 beater. Similarly, while itās entirely possible that we could be facing a wrongful death claim from a vehicle accident, itās much more probable to be involved in a minor accident with less than $10,000 of injuries, if any.
I am actually more concerned with making sure that our medical expenses will be paid, regardless of fault, than I am about the risk of a huge judgment which would either be settled for less than face value, or if the plaintiff chose to play hardball, discharged in bankruptcy. To that end, I have medical payments coverage on all of our vehicles in the amount of $5,000 per person, as well as uninsured motorist coverage (which would cover our medical expenses caused by an at-fault uninsured driver up to my own policy limits).
The thing is that it doesnāt cost that much more to be much better covered. I carry 250k/500k plus uninsured and itās around $900/yr for two newer vehicles and one āclassicā with an agreed upon value.
If the added coverage greatly increased the premium, then I would agree with you. But weāre talking about $80/yr for much better coverage. vs. the bare minimum.
I carry 250k/500k liability. Itās not that much more expensive and without that I canāt keep my Umbrella which begins at that level and goes waaaay beyond that.
I have uninsured driver and under insured driver coverage and unlimited catastrophic coverage, full collision, and all that at highly affordable peace of mind. Oh, and road service with another provider that even covers my bicycles!
CSA
For 3 vehicles, and 2 drivers, I am paying $1200 twice a year. To get substantially higher policy limits would run the cost much higherāat least another $400-500 per year to insure against a risk that Iād never actually pay for anyways. While I am not interested in being driven to bankruptcy in the event of a minor traffic accident (hence the reason I even bother to have insurance), I do not have and cannot get the money to pay hundreds of thousands or millions of dollars for a debilitating injury or wrongful death claim.
Thus, in the extremely unlikely event such a thing occurs, I would declare bankruptcy, and the plaintiff would receive my non-exempt assets which would be a small fraction of their judgment, and the rest would be permanently discharged.
Oh man, I know this is old but I just couldnāt disagree more. You donāt insure for the likely, but you insure for the catastrophic. Not to mean that you donāt insure for the likely fender benders, but you insure for the million dollar judgement hitting a school bus etc. Itās been a while but you donāt discharge judgments in bankruptcy. So gee if youāve got a job, a house, any other property, you can be on the hook for years. If you have nothing, OK, judgement proof unless theyāll tap your paycheck a few hundred for life. The thing is that is what umbrella policies are for. Once your car or house insurance liability limits are reached, the umbrella kicks in. They only cost a few hundred a year for several million of protection. Plus the defense lawyers come free.
Really I donāt know where these ideas on insurance come from. Medical bills are one thing but liability for damages you can cause in the normal life activities are a whole 'nother matter.
@bing, you are wise beyond your years, Bud, eh!
Donāt ya know? Iām cheap and donāt āwasteā any money, except possibly money spent on insurance Iāll never use. Iām certain I have too much insurance. Wait! Is there really such thing as being over-insured as the experts warn?
My answer is, āDonāt know, donāt care.ā I sleep very well.
Aside from say, life insurance, insurance, particularly liability insurance, is not an investment and canāt be looked at in that light. How many investments does them have that them hopes them never uses, eh?
CSA
If you have any kind of assets (home, boat expensive jewelryā¦etc) that you want to keep, then you are woefully under insured. My nephew was in an accident a couple years ago and had to have his leg reconstructed. Several surgeries and over a year of therapy. The guy who hit him had good coverage. In the end his insurance company paid out well over $300,000 in medical expenses. Another $40,000 in lost wages, and then another $500,000 in pain and suffering. If this guys insurance didnāt cover it, but he had a home or boatā¦my nephew would be owning them now.
As Iāve said, I have āwastedā tens of thousands of dollars by buying insurance and never using it, but itās not an investment. I actually hope I do āwasteā the dollars, rather than go through the process that involves making claims. Again, itās not an investment.
Similarly, people look at Social Security as an investment, when itās actually insurance.
They take it early because theyāre afraid theyāll die before they reach their ābreak evenā point on their āinvestmentā. They site heredity, taking it before the government goes belly up, etcetera.
But, I learned to look at it as insurance. Itās not insurance, in case you die, but rather insurance, in case you live. By waiting until full retirement age or older (I waited until turning 70 when it maxes out) you can get a whole bunch more until you do expire.
Itās insurance to insure (in case you live) that you wonāt run out of money. I know lots of people who did the Social Security investment strategy and I play golf with them. Some are in their late 80s and could use a few more bucks coming in. The honest ones admit to me that, looking back, they should have done the insurance strategy and waited before claiming.
On this site we get people saying that āTheyāve invested in a new carā¦ā Cars generally, are not an investment and insurance, generally is not an investment. Sometimes it behooves one to know an investment when one sees one and identifying spending thatās not one.
It could even be the difference between making butt prints in the sands of time on a beach during winter months, or freezing toes and other precious body parts, running a snow blowerā¦ just saying.
CSA
I retired at 64, started collecting SS at 65, I think my break even point was 78.
I didnāt give a rip about breaking even, but rather insuring myself in case I lived for a while. Not only did I wait until 70, but my trophy 
wife, whoās 9 years younger than I, will wait until her full-retirement age (not 70), a few years off, yet, to collect.
That way, if I kick the bucket first, which is logical, she can take over my entire benefit, which is substantially larger than herās would be and go on living the dream (she would take over my entire pension amount, too). If she collects at the earliest time allowed then she will run short of income.
Thereās really quite a bit to consider and there is no āone size fits allā recommendation for the considerations. As with car insurance, it behooves folks to do their homework.
CSA
You get to a certain ageā¦you really donāt need life insurance. We dropped ours years ago. If either one of us dies then the other gets all the assets and savings. People who live paycheck to paycheck seem to need life insurance.
Automotive liability insurance is just covering your butt in case something happens.
And not only do we have good liability insurance on all our vehicles - we also have a high umbrella policy to cover our assets. At one point I owned 4 income properties. If I caused an accident that killed someone I could have lost all it. Itās nice to be protected.
As Iāve stated beforeā¦Millionaires donāt have insurance of any kind. Theyāre self insured.