November 5, 2011

Changing Your Deductible For Lower Auto Insurance Costs

No matter what state you live in, you must have car insurance if you plan on driving your car anywhere. Every state dictates how much car insurance you must carry in terms of bodily injury and property damage liability limits. This often creates a burden of what you must spend on auto insurance costs, which is often very expensive. The one thing you do have control over is the car insurance deductible.

The car insurance deductible is the amount that you must pay before the insurance company will pay for any repairs that you've sustained. This deductible can range from $250 to $1,000 and even more. It's important to pay attention to this number so that you don't spend too much out of pocket.

It's also important not to have the deductible too low. The lower your deductible is, the more expensive your monthly car insurance payment will be. You're not going to pay a lot of money to repair your car each time you're involved in any kind of accident, and your car insurance company will have to pay more money.

If you are willing to pay more when there's an accident, your car insurance company will lower monthly premiums. Ultimately, you need to find the happy balance between not paying too much out of pocket in the event of an accident and paying too much every month. When you call your insurance company for a policy quote, you can find out just how much savings you can expect.

Look at your policy and find out what your current auto insurance deductible is. Chances are it's pretty low because car insurance companies want to make as much money as they can from you every month. If your deductible is currently $250, make the call and ask for a new quote based on a $500 deductible. Watch your monthly payment drop significantly. Now see if they'll give you a policy with a $1,000 deductible.

You need to be careful about raising the deductible too much. If you get into an accident, this must be paid out of pocket to the insurance company before they will start paying money to repair your car. If you're short on money when you're in the accident, this could mean that your car is stuck in the shop until you do have the money.

Auto insurance costs are not the cheapest in the world, but you do have options to get them lower than ever before. If you're a safe driver and don't get into many accidents, a lower deductible could be the best option for getting low monthly premiums.