Your eye catches sight of that flashy, exciting sports car on the car lot. It is easy to imagine yourself behind the wheel impressing your friends. You turn onto the lot just to see if a test drive is possible. The next thing you know, papers are being signed. The car is yours. You make contact with your insurance agent and discover that the sticker shock for the car insurance is worse than it was for the car. What can you do now?
If you are finding it hard to afford the insurance for your new sports car, it is time for an insurance review.
There are some things that you must have. With a new or late model sports car, maintaining collision insurance should be considered necessary whether the car is financed or not. Keeping adequate liability insurance is a legal requirement that cannot be avoided. You can probably live without towing coverage. The same is true for emergency road insurance. Drop the added part on the policy that will get you a rental car while your sports car is in for repairs after an accident. Go over any of the other fine print with your agent to see what else might be able to be removed from your coverage options. Everything that is deleted will lower your premium.
Consider going with a very high deductible on the collision part of your car insurance policy.
Many drivers try to have collision deductibles in the $250 to $500 range. This will make getting a car repaired after an accident relatively painless for most people. However, if you can work to build up a reserve savings account for this purpose with $1,000 or more in it, you can raise that deductible way up. Even a $2,000 deductible is not unreasonable you are driving a $30,000 sports car. The key is to be faithful to put enough money in the account to cover your out of pocket loss after an accident. This is one way to encourage yourself to be a safe driver.
You may feel the need to maintain your comprehensive car insurance.
This insurance will protect you from theft, acts of nature, vandalism and glass breakage among other things. It may be best not to be hasty in deleting this coverage. If you have a loan on the sports car, the lender may require that you keep this insurance. Like the collision insurance, you can raise the deductible on the comprehensive. This insurance is frequently sold with low deductibles. Raising the comprehensive deductible to $1,000 or so will drive your insurance cost down.
Take a hard look at your liability to see if you feel it can be lowered.
While it is prudent to maintain enough liability insurance to protect all of your assets, it may be that you need to carry a little more risk here for your. During the first year or two that you have this sports car, you might have to live with just the legal minimum in liability insurance. This might move you from your comfort zone, but it will help your pocketbook in the short term. As you become more able to afford your new car, raising these liability limits should be a priority until they are high enough to give you full protection of your financial assets.