Another thing to remember: Arizona has no law requiring uninsured/underinsured motorist coverage. You may have an accident where you are not liable but the other person’s insurance does not cover your expenses. Yes, you can sue for those monies, but while you are waiting for that suit to settle, you have car repairs and medical bills. Uninsured motorist coverage protects you in this situation.
Of course, you will likely want to adjust your coverage as the car depreciates. No matter how much coverage you choose, the insurance company will only reimburse you what your car was worth just before the accident, not what it costs to replace it. If you paid $30,000 for it new but the KBB value on it at the time of the wreck was $10,000, you only receive $10,000. So stay up-to-date and adjust your coverage amounts accordingly.
Should You Ever Drop Full Coverage?
Again, once the car is paid in full, maintaining full coverage is a choice. You may opt not to make that choice if you decide the value of the vehicle is no longer worth the cost of insuring it. As stated above, reimbursement is only equal to the car’s value, not what it would cost to buy another car. If the vehicle is worth only a few thousand dollars, you may decide the money you spend on full coverage insurance is better spent going into a savings account to buy a new car.
Do not base your decision on the fact that you have never had an accident, as accidents can happen at any time. They are one of the few things you cannot use history to predict.
Conclusion
Consider carefully the overall costs of full coverage and liability insurance when deciding between them. When you do opt for full coverage, look at the numerous options and add-ons. Some are definitely worth the extra cost in your premium. Do not forget to adjust your coverage amounts as your vehicle depreciates. Yes, there are scenarios when full coverage is unnecessary, just not many of them.
