Paying off a car feels like reaching the finish line, only to discover the insurance bill is still sitting there waving from the sidelines. At $200 a month, that insurance costs $2,400 a year, so it makes sense to question whether full coverage still earns its keep once the lender no longer has a claim on the vehicle.
The answer depends less on whether the car has a loan and more on what the car is worth, how much it would hurt to replace, and what the policy actually covers. A paid-off vehicle doesn’t suddenly become invincible, and dropping the wrong coverage can turn a monthly savings decision into a very expensive afternoon.
