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Smart Shopper Gap Insurance
440 messages, Last post on Sep 24, 2009 at 1:20 PM
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Replying to: marsha7 (Sep 16, 2009 11:52 am) |
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I realize that I may be in the minority with a $1 million UM umbrella ($175/year)...but, as a PI attorney, I have seen medical bills easily surpass $250K, and the injured party, now permanently injured, walk away with only $25K or $50K because that was the insurance limit that the at-fault driver had...suing them would do no good, as they could dump the judgment in Chapter 7 bankruptcy... If the victim had their own UM, and the $1 million umbrella, they could have recovered against their own UM (under-insured, along with uninsured)ins and not been destitute after the wreck... From a layman's standpoint, the odds of ultra serious injury are quite low, but from a PI attorney's view, this scenario happens more often than one might think, so I see the need to protect myself and family...and, with the cost of an add'l $175 per year, it is not prohibitive...but if one of us was seriously injured, I have a way to recover if the illegal immigrant was uninsured, or the 25 year old deadbeat bought his minimum policy off some TV ad... YMMV...
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Replying to: marsha7 (Sep 17, 2009 8:09 am) |
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Replying to: Mr_Shiftright (Sep 14, 2009 12:42 pm) I understand the logic shifty and marsha7 but I don't see Gap insurance as a "must have". Why finance a car that depreciates quickly for so long? You may as well buy an extended warranty and the service contract. |
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down: It all depends on your financial situation...unless you finance under 3 years, or place a substantial down payment (25% or more), the odds are that your vehicle will depreciate much fatser than the loan balance is paid down...hence, the "gap"...look at an amortization table for your loan, and assume that your vehicle will drop at least 25% in year one, 50% in year two (esp if made by UAW)...if your vehicle estimated value and loan payoff are never over $1000, then gap is probably not necessary...but if that gap is over $2,500, then gap for a measly $10/month can be quite useful...if you are leasing, it is even worth more because you owe the full amount of the lease no matter what, and the insurance that pays for the "total" will certainly not pay off the lease...since most folks do not have $2500 sitting around to pay off their loan, I recommend gap, almost always...that being said, it is only my reco...if you wish to assume the risk, please do...but many folks reading these posts have no idea what gap ins is or what it does, so my postings are an attempt to tell them why I think it is wise to purchase, but no one has to do so...this is a supposedly a free country, altho much less so at the end of this administration... wd: "if you're the victim in the accident and have to recover against your own policy via the umbrella due to the no-neck being UM, how long it would take your insurance company to drop your butt once they've paid out on it...and good luck finding another insurer once they discover that eh... "...I believe that is no longer important...if you are sufficiently injured that you must recover pain and suffering from a $1 million umbrella, the last thing you need to worry about is if they will drop you, as your condition may be such that you are unable to work again, and you have to invest and live off the settlement...whether they raise your premium 25% or you need new insurance is hardly the 1st priority if you are injured that seriously, IMO...also, don't forget...you can only recover assuming that the OTHER guy is at fault, so you may not be dropped at all...now, if YOU cause the wreck, then you have no recovery at all except for medpay to pay your bills, if you have medpay on your policy... This is only my belief, considering what I have seen from folks who are were seriously injured and did not have sufficient UM, and, with 20/20 hindsight, if they had had it, they could have been adequately compensated... Further, it is my belief, without any proof at all, that there is a percentage of folks out there who probably cause a disproportionate amount of accidents simply because they are bad drivers, so they are the ones who statisically may drive and have little or no insurance, when they are the ones who should carry it the most...adequte UM protects you from those folks, altho it actually protects you against EVERYBODY with insuff insurance...last year I had a case where the father makes very good money, but he scrimped on his insurance...$50K in liability but only $25K in UM...I could not understand why... |
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Replying to: marsha7 (Sep 17, 2009 11:07 am) I don't think people in Boston are going to like you talking behind their backs 
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Replying to: marsha7 (Sep 17, 2009 11:07 am) Who knows? I might be overreacting. You blame the current administration for our "lack of freedom", I blame our past couple decades of living beyond our means, greed and corruption. What is happening today is a direct result of living beyond our means. $700B for the banks, another $790B to keep the economy going. And unemployment is at 9.4%. Personally, I am working on paying off all my debt (except home and car) so I can handle whatever the government can dish out. |
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Replying to: Mr_Shiftright (Sep 17, 2009 12:28 pm) |
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"I just think we need to change our spending habits. If you need a new car, put 20% down and don't finance a car for more than 5 years. Can't afford that, than buy used or save up the money"...I cannot disagree with you there, but a downstroke of 20% on a 5 year loan would, IMO, have NO CHANCE of keeping up with the depreciation, especially if it is an American car...except for maybe Corvette, no GM car will be worth 50% of its purchase price in 2 years, whereas the loan payoff in 2 years, with 20% down, I think will be thousands of $$$ higher than the vehicle value...if totalled in first two years, then the owner will have to come up with thousands out of pocket, which most cannot do...so, all my arguments is this: gap insurance at a measly $10/month will remove that stress, and the cost is nominal...I do it for the stress relief...if you don't want to, don't buy it...but it IS an intelligent way for folks to protect themselves from a major payout with money they do not have... I was PO'd at Bush for the first bailout as much as I am about Obama...most conservatives (altho I consider myself mildly moderate...  ...meaning just to the left of Attila the Hun) were upset at Bush for No Child, Medicare Part D, and Bailout...and a few other things as well...
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Replying to: marsha7 (Sep 17, 2009 11:07 am) Also, 15-20 years ago we added a $1M umbrella policy. It covers our house, lake behind the house, pool, vehicles, etc. liability. IIRC it is between $300-$350 each year. Just looked it up $336 a year. I hate paying insurance, but the alternatives if the worst happens are unplesant to worry about. Of course, before I accumulated some assets it there was not as much risk as there is now. Bill |
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