Do I Need Collision and Comprehensive Insurance on an Old Car?

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Updated: 18 March 2024
Written by
Jeff Bray
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When you drive off the lot with a brand-new vehicle, you are required to carry full coverage. This is to protect you and the lease company from any claims that should arise while you are still making payments on your car. But what happens when you meet your obligation, and the car note is paid off? Do you still need to carry Collision and Comprehensive insurance on your car, which is now considered old on the car insurance market?

Through our discussion, we will show you why it is important to continue to carry full coverage and why you run the risk of having to pay higher costs should you be involved in an auto incident when you carry Liability Only. Through my 12 years of experience, I have heard many stories of what not having the right coverage can do. You have options, and we are here to meet your insurance needs.

Key Takeaways

  • When you are no longer under a vehicle lease, you can purchase Comprehensive and Collision coverage for your car.

  • Comprehensive Coverage is designed to protect you against damage to your vehicle: hail damage from a storm, broken glass from vandalism, and if someone steals your car.

  • Collision Coverable protects your car should you be involved in an automobile accident or if you collide with a stationary object like a wall or mailbox.

Do I Need Collision and/or Comprehensive Insurance on an Old Car?

Owning an older car has different insurance needs than a drive-off-the-lot vehicle. You no longer have the lease Company looking over your shoulder to ensure there are no scratches or dings in your fender. However, should you drive an old car, you may want to consider a few things before unchecking those boxes for Comprehensive and Collision insurance—you may need them.

With older model vehicles, it is best first to research how much the car is worth. It is common that insurance Companies total out vehicles for relatively minor damage because most of the parts needed are either hard to find or no longer made.

Then, check on repair costs. If they do have the parts, finding a mechanic who will change them out is another problem. If your price for repairs is less than your yearly insurance Comp/Collision premium and deductible, you may want to consider your options.

What Is the Difference Between Collision and Comprehensive?

Auto insurance begins with Liability Only coverage. This consists of Bodily Injury (BI) and Property Damage (PD). These provide coverage for the other driver’s damages and injuries. However, it does not protect you. If you desire personal protection, this is where added coverage comes in.

Collision Coverage

First, you have Collision Coverage. This insures you for damages to your vehicle when you are involved in an automobile incident. It will cover you when:

  • You have an accident with another vehicle.
  • You collide with a stationary object like a fence or a tree.
  • There is an accident where it is just your vehicle like a rollover.

It will not cover your medical bills, nor will it cover damage to another person’s vehicle or the damage to the property you caused.

Comprehensive Coverage

Next is Comprehensive Coverage. This is when you have damage caused by specific incidents, other than a Collision, that happens to your vehicle:

  • Theft
  • Fire
  • Vandalism
  • Natural disaster
  • Falling objects
  • Animal strike
  • Civil Disturbance

When you select an amount for your policy, consider the Actual Cash Value (ACV) of your vehicle. This can include any modifications you have made to your car that you have claimed on your auto insurance policy.

Can You Have Both Collision and Comprehensive Cover on an Old Car?

Yes, you can have both Collision and Comprehensive on an old car. Since each policy covers different areas of the vehicle. Amounts will depend on the owner’s personal preference, if they have additions to the car that make it more valuable, or if they use the vehicle that would warrant the additional coverage.

When Do You Need Comprehensive and Collision Insurance on an Old Car?

All vehicles should have some form of auto insurance, new or old. However, there are times when you need Comp and Collision more than others.

Who Is Required to Get Comprehensive and Collision Insurance on an Old Car?

There are two main instances when it is strongly suggested that you carry Comprehensive and Collision insurance on an old car.

Under a lease: When making payments on your car, you must carry full coverage. A full coverage package includes both Comp and Collision. These coverages compensate the lease company should a claim be filed while you are still under contract with them.

Classic Car: If your car is a particular older model that you have restored, it carries more value than most old cars. Liability Only coverage will not cover your vehicle. In many cases, Comp and Collision are required to protect your investment.

Classic Car Provisions: If your vehicle is a classic, some provisions must be followed. It cannot be driven daily; it must be stored when not in use, and the driver must pass certain requirements to be eligible to drive said vehicle.

Affordability: Sometimes, it would be simpler and less expensive to make a higher monthly auto insurance payment than to have to purchase another automobile out of pocket.

Note: There are no states that require a driver to carry Collision and Comprehensive auto insurance. However, as discussed, most lenders mandate it as terms of a lease.

Are Collision and Comprehensive Insurance on an Old Car Required by Law?

While leasing Companies may require you to carry a certain amount of auto insurance to protect their investment, it is not required by law. And old cars are no different than any other vehicle on the road; they only require Liability insurance to be considered legal on US highways.

If you are concerned about your investment, purchasing a Full Coverage policy would be in your best interest. However, none of the 50 states require drivers to carry Comp and Collision, but all states require some form of minimum Liability Insurance. The differences lie in whether that coverage includes Uninsured Motorist Insurance.

States that list Uninsured Motorist as part of their minimum state requirements are:

  • Connecticut
  • Illinois
  • Kansas
  • Maine
  • Maryland
  • Massachusetts
  • Minnesota
  • Missouri
  • Nebraska
  • New Hampshire
  • New York
  • North and South Carolina
  • North and South Dakota
  • Oregon
  • Vermont
  • Virginia and West Virginia
  • Washington
  • Wisconsin

Do You Have to Have Comprehensive and Collision Coverage on a Financed Car?

Signing the contract for a new vehicle is an exciting moment. Then they hit you with the gut punch. “So, who is your insurance provider?” Yes, before you drive off the lot, in addition to your down payment, you need to prove to them that you have auto insurance coverage.

Since you have a financed car, you must have Comprehensive and Collision Coverage as part of your Full coverage auto insurance policy. This protects you as well as the lender in the event of vehicle loss through theft or another unforeseen incident.

Average Cost per Year of Collision and Comprehensive Coverage on an Old Car

We all want affordable insurance whether it is Full Coverage, Liability, or adding on coverages such as Comprehensive and Collision Coverage. What factors into the cost of car insurance?  We want to assist you in understanding your insurance premium.

How Much Does Collision Insurance Cost on an Old Car?

Multiple factors influence the cost of Collision insurance on an old car. The good news is that many of these you can control.

  • Garage location – Where you live and park your car can determine how much you pay for your insurance.
  • Make and model – Who makes the vehicle can determine its insurance value, but if your car is considered a classic, it may increase the cost.
  • Age of the vehicle – The year of the car can weigh heavily on how much you pay for insurance. An older vehicle can lower your insurance cost.
  • Claim history – If a car has many damage claims, it will increase the insurance premium.
  • Driver’s history – Not only will damage claims increase premiums for Collision insurance, but a driver’s history. Too many accidents can make insurance almost unaffordable.

How Much Does Comprehensive Coverage Cost on an Old Car?

Just like Collision coverage, Comprehensive coverage on an old car is affected by incidents that happen to the vehicle. Only these incidents are more naturally occurring vs. occurring due to the driver’s actions.

Some factors influence the cost of Comprehensive insurance.

  • Value of the vehicle – This is not how much you paid for it. Kelley Blue Book is one source generally used to determine the current value of an automobile.
  • Where you live – Zip codes can determine how much you will pay for most levels of car insurance.

Your insurance claim history – The more or fewer claims you file can determine how much you will pay for Comprehensive insurance on your old car.

What to Consider When Choosing Comprehensive and Collision Insurance for an Old Car?

When considering Comp and Collision insurance, you need to think outside the box. Insurance is more than driving on a highway or insurance rates.

  • Is your area prone to extreme weather conditions and natural disasters?

Living near the ocean or in an area that has earthquakes or tornados makes your vehicle susceptible to damage to weather events.

  • Is your area flood-prone?

Low-lying areas, even those that don’t see them regularly, can put your vehicle in danger of water damage.

  • Does your area have a high crime rate?

Theft and break-ins are covered in different aspects by both Comp and Collision insurance.

  • Do you often drive through roads with high animal Collision numbers? Remember, Comprehensive Insurance covers animal strikes, Collision does not.
  • Do you often commute in heavy traffic?

The more you drive and the longer your commute, the higher the chances are of you being involved in an accident.

  • Do you frequently drive in areas with high car accident rates?

Be aware of your surroundings and other drivers around you. Even if you are a careful driver, it doesn’t mean other drivers are.

  • Your car’s lender may require Comprehensive coverage.

Even if you have an old car, you still may be required to carry Comp or Collision insurance. Know your state insurance laws.

  • How old is your car, and what is it worth?

Your vehicle’s age can determine how much you pay for auto insurance. This can fluctuate depending on whether your car is considered a classic.

  • How much are the annual premiums for Comprehensive and Collision coverage?

Many factors go into determining premiums: model, year, and even the style of vehicle can determine premiums. Add-ons can also be a factor.

How to Save on Collision and/or Comprehensive Insurance on an Old Car

Everyone wants to save a buck on their car insurance. This is why once they reach the end of their lease, they fall back to liability-only coverage. But this is only one way to save money.

Consider your car’s value

You do not always have to max out your Comp and Collision coverage. Check your car’s current value and then match that to your yearly cost for coverage.

You can drop one coverage

There is no rule that you must carry both Comp and Collision. Determine which coverage is best suited to your needs, then purchase that policy.

Shop around

Insurance is not uniform. You may find a less expensive policy with another provider. Pull quotes with two or three different companies before making a decision.

Consider discounts

Don’t leave money on the table. Read the fine print on the insurance website. You can find discounts for a good driver, being a good student, serving in the military, being a teacher, or even bundling with a homeowner’s policy.

Location, location, location

If you are moving, consider using auto insurance as a home shopping tool. Where you live can determine how much you pay for car insurance, especially add-ons like Comprehensive. A high-crime area where vehicles are stolen will give you a higher Comp rate than a lower-crime area.

When to Drop Collision and/or Comprehensive Insurance on an Old Car?

Dropping Collision and Comprehensive Insurance is a big decision. Because without it, you place yourself at risk of losing your vehicle every time you get behind the wheel. For many, this is more of a financial decision. However, yes, there are times when it can be appropriate to drop coverage.

If your annual payment is more than what your car is worth, then it may be time to make a financial decision to drop coverage on at least one of the coverages.

However, if your car is considered a classic car, you may want to reconsider this move as a car has value, and you want all the protection you can get.

Agreed Value: Keep in mind that in an insurance contract, no matter how much you put into a classic car, if your car is deemed totaled, you will only receive the Agreed Value of your insurance policy. When you make additions to your car, it is wise to review your policy to see if it still suits your needs.

Best Insurance Companies for Collision and Comprehensive Insurance on an Old Car


State Farm

Overall Rating
4.8

Overview

A Familiar name that is trusted in the industry. They provide coverage for classic, collectors, and vintage insurance seekers, with all coverage levels from Liability only to full coverage that includes Collision and Comprehensive coverage.

Progressive

Overall Rating
4.8

Overview

Another familiar name for auto coverage, available in every state. One benefit of Progressive is you can bundle it with the other policies you have with them that include homeowners, renters, and even your standard auto insurance policy.

Grundy

Grundy is one the largest names known in the auto collector’s industry, especially amongst hot rods. These are for those vehicles that are at least 25 years or older. They do not have a deductible in many states and liability limits up to $1 million and an inflation guard to protect the insured against the cost of upkeep.

Haggarty

Haggarty is one of the best due to its affordability. You can customize your policy based on your needs. And while most old car policies limit you to mileage, Haggarty provides you with flexible mileage. They also offer you upon signing up with guaranteed value coverage. What you agree upon on signing up, they will pay you should you experience a loss.

FAQs

Do I need Collision or Comprehensive insurance if my car is paid off?

If your vehicle no longer carries a lease, then you don’t necessarily need to carry Comp and Collision. However, if you use your car for work, you have add-ons, or it is considered a classic, then it may be beneficial to keep both insurances for your protection.

Is Collision or Comprehensive coverage the same as full coverage?

No. Full coverage is a blend of multiple parts of insurance. It is Liability Insurance, which is Bodily Injury (BI) and Property Damage (PD) in addition to Collision and Comprehensive. In some states, it adds Personal Injury Protection (PIP) and Uninsured/Underinsured Motorist.

Is it worth carrying Collision insurance for a teen driving a 12-year-old Nissan?

Many factors play into this scenario. If this is the teen’s only means of transportation and it is a significant factor that he has a vehicle, as for school or a job, then yes, it would be wise to carry Collision insurance. However, if it is a pleasure vehicle, then no, it is unnecessary.

Should I have Collision insurance on a 10-year-old car?

When you have finally paid off your car note and are looking forward to paying liability insurance, ask yourself a question: Is your car worth more than what your payment of Collision insurance payment would be? If the answer is yes, then you need to carry Collision insurance. If not, then you can consider dropping coverage.

What is the difference between Comprehensive loss and Collision loss on my auto insurance documents?

A Comprehensive loss is damage to your vehicle, like a tree branch that falls on your car during a storm or someone breaks into your car. Collision loss is if you were to have an accident with another vehicle or drive off the road. Remember that if you were to have an incident with an animal, it is covered under Comprehensive insurance.

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