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What does it mean to be over insured with auto insurance?

I am trying to cut cost and was told to make sure that my auto insurance is not over insured.

asked by Lucrece (9)

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Tags:  cars  insurance

answers

Being over-insured would mean that you have too much coverage. This could include not only the amount of coverage, but extras like car rentals while your car is fixed.

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posted by John (7910)
7 votes

To be over insured is to be paying for too much auto insurance. For example, if you have collision insurance to replace a car up to $20,000 in worth and the vehicle is only worth $5000, you are paying for insurance that exceeds what you could get back.

7 votes

You don't want to have more coverage that you can ever file for. If your car is an older model don't get coverage based on a new car rate

6 votes

Being over-insured means that you are carrying more replacement value or actual cash value insurance than your property is worth. For example, carrying a $20,000 policy on a $14,000 diamond ring. Most insurers underwrite to value and being over-insured is not a common practice or good business sense for insurers.

6 votes

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