How Do I Calculate The Best Car Insurance Deductible For Me?

By Mike Anderson Posted in Car Insurance News

Deductible Range

When shopping for a car insurance policy, determining an appropriate insurance deductible is very important. Depending on what insurance company you go with and the cost of your insurance premium, your deductible can range from zero to upwards of $1500.

The Insurance Deductible Is The Out Of Pocket Cost That You Are Responsible For

An insurance deductible is the amount of money that you have to pay out of pocket when you file a claim. For instance, if you are involved in an accident and the repair costs are quoted at $2,000 and you have an insurance policy with a $500 deductible. You will cover the first $500 and then the insurance will pay the remaining $1,500. It is important to note that you are responsible for the deductible every time that a claim is filed. This is different from other types of insurance where once you meet a deductible you do not pay any more money out of pocket until the following year.

Lower Insurance Deductibles Means Higher Premiums

When deciding on a deductible amount it is necessary to get a good balance between your premium payments and your deductible. The higher you insurance deductible is, the lower your monthly payments will be. While picking a plan with a low monthly premium but high deductible may seem to be a good choice, remember if you file a claim but cannot pay the deductible your car is not getting fixed.

So it is very important to choose a deductible that you are comfortable paying if you need to file a claim with your insurance company. Often times it is recommended that you set aside enough money to cover a deductible if the situation arises where you need to pay it. Another thing to consider is the area you live in. If you live in a large city where you are more likely to make multiple claims, a policy with a lower deductible would be best for you. However, if you live in safe area and are a safe driver who is likely to not file many claims, then a plan with a higher deductible and lower payment may be right.

If you are having trouble calculating which deductible is right for you, it is good to know that many auto insurance websites have calculators that will determine the best deductible based on surveys that you take.

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  4. How Are The Average Car Insurance Rates Determined?
  5. How Do You Choose The Best Low Cost Car Insurance?

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