Consider Cutting Collision, Comprehensive Coverage

If you want to save money on your auto insurance — and who doesn't — ask your agent whether you really need that part of your policy known as collision and comprehensive coverage.

If you choose to buy collision coverage, your insurer will pay for repairs to your car after a smashup if it was your fault or you can't collect from the driver who caused the accident.

Comprehensive coverage, which is also optional, protects you against other losses — for example, if your car is stolen or vandalized, is hit by falling objects, catches fire or is damaged in a flood.

Comprehensive additionally covers loss of items installed in your car, such as a radio, but usually not anything you are transporting in it; such losses are covered by your homeowner or tenant policy, as long as your car was locked when the theft occurred.

There are often significant differences in premiums for various makes and models. Cars that are easily damaged in accidents, are popular for joy riders or are a valuable source of spare parts are more expensive to insure. Collision and comprehensive insurance is cheaper on cars that are harder to damage and easier to repair.

If you decide to buy collision and comprehensive coverage, remember: Your insurer will not reimburse you for more than your car's current retail value. Consequently, you might be wise to buy both coverages only when your car is less than three years old.

To keep premiums reasonable, take the largest deductible — the amount you must pay before the insurer starts reimbursing you — that you can afford. Car owners typically accept deductibles of $250; but $500 might be better because it will knock about 10% off your premium.

If your car is more than five to seven years old, or is worth less than $1,500, you might consider dropping your collision and comprehensive insurance altogether.

As you shop around for the best policy, keep this rule in mind: Never risk more than you can afford to lose, but don't pay to insure what you can afford to risk.

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