[R] insignificant factors in regression model

[Weijie Cai]

Hi list,

I am building a regression model with categorical predictor variable coded 
by treatment contrasts. The summary of the regression model shows that some 
levels are significant while others are not. The significant ones show that 
they are statistically significant from the basis factor (at level 0). How 
do we generally deal with those insignificant levels? If they are used for 
prediction, sometimes they will produce strange results because their 
coefficient estimates have large variances. Do we just simply ignore them 
assuming they are not different from level 0? Or do we exclude them in 
factors (by treating them as zero's) and refit the model?

any suggestions?