subject: Choosing an Auto Insurance Collision Deductible [print this page] Choosing an Auto Insurance Collision Deductible
When choosing and auto insurance collision deductible it is important to compare the premium associated with the deductible that is selected. Many times the collision premium on a policy will be the largest contributing factor in the premium. This reigns true for youthful operators and drivers that have multiple violations.
When selecting a collision deductible there are many options to choose from. The most common are $250, $500, and $1000. The rates will vary based between the options available. The deductible listed on the policy is the amount that the insured will need to pay out prior to the insurance company paying for repair or replacement of the vehicle.
The most common deductible that is carried on a policy is $500. When a vehicle is financed the lender often requires that the borrower carries no higher than a $500 deductible. With the premium derived from collision coverage being the highest on many auto policies it is recommended that when getting auto insurance quotes that consumers request the rates for $500 and $1000 deductibles.
In some cases changing from $500 to $1000 can reduce the premium on the policy by as much as $400 per year. In these types of situations drivers with a low accident frequency will have limited exposure. If the driver were able to avoid getting into an accident for 2 years they would actually have saved more in premium than the additional $500 exposure that they had created by making the adjustment. This is why many drivers have changed their preference to the $1000 deductible. It is especially a good choice when the driver themselves is in a financial position that the additional exposure does not pose a major concern. Drivers that have a current auto insurance policy can call their agent to discuss the difference in premium that would be associated with changing their deductible. Many times consumers can get a significant saving while only having minimal additional exposure.
welcome to Insurances.net (https://www.insurances.net)
