When should I cancel Physical Damage insurance on my car?

We advise our clients to process a simple mathematical analysis:  At the end of the exercise ask yourself if you are spending your money in the best way, or should you apply the savings to purchase higher liability limits or even excess limits with the purchase of an Umbrella policy. 

Mathematical analysis:                                                 Example 1                      Example 2

Assess current market value of your car                $4,000                           $1,500

Collision Deductible applicable if loss occurs        $1,000                            $500

Cost of annual Collision insurance                             $500                              $300 

Net actual claim settlement                                         $2,500**                          $700**

**THE QUESTION then becomes, at what value are you breaking even or self-insuring?