When Should You Drop Collision On Your Auto Policy?

Dropping collision coverage on your auto policy can be an easy decision once you consider the various factors. The first things to check are the premium cost for the coverage and the actual cash value (ACV) of your automobile. To find an estimate of the ACV of your car it isn’t an exact science. It is a combination of looking at Kelly Blue Book value and what your car is selling for at local dealerships. The closer the premium is to your ACV the easier the decision is to drop collision. The deductible on the auto is also an important factor to consider.

car crash

A good example is: if the value of your car is $2,000 and the premium is $450 with a $500 deductible and you get into a single vehicle accident, you are already invested $950 on a $2,000 car and that’s just one year of premium. This is when you would consider saving money on your $450 premium and drop the collision. However, if you are living pay check to pay check the $1,500 ($2,000 ACV – $500 ded) you would get from the insurance company if the car was totaled would at least give you some cash to buy a new car.

Some times when your car is older and/or has very high mileage you can consider dropping collision because the older your car is the lower its actual cash value is. However, if you are very dependent on that vehicle and you must repair it for daily transportation, then the decision may be a bit more difficult. Also, can you afford the out of pocket cost of an accident or is it easier for you to manage paying for the collision coverage in small amounts throughout the year?

Everyone’s financial situation is different, so consider all the factors before deciding to drop collision. If you would like to talk to us about this decision, please call us! We are always happy to help: www.mancuso-nowak.com

Tax Free Weekend

Time to shop! Tax free weekend is August 15-16 this year. It is a great time to buy that bigger ticket item that you have been putting off purchasing. Back to school shopping should be a little less costly with this tax break. If the kids need a new computer for college, Apple is urging people to wait until tax free weekend, since Apple products never go on sale. The 6.25% savings is substantial if you are spending a lot of money. The item must cost less than $2,500 to be included in the tax free benefit.


The tax free weekend has just been determined by lawmakers because many of them oppose the idea. The state of Massachusetts will loose $20-$25 million in tax revenue during this one weekend. But the surge in sales during a slow time of year far out weighs the taxes that will be lost. The goal is to promote buying within the state. It will benefit our economy.

So shoppers get your credit cards handy….ready, set, shop!