December 15, 2011

Why Watching Deductibles Is Important When Buying Auto Insurance Online

It's easier than ever to find auto insurance online, as every major insurance company now offers an easy way to find a quote and buy coverage through the web. However, many drivers focus too much on insurance premiums when looking for insurance quotes. A policy with a low premium might also have a high deductible, and as many drivers learn when the time comes to submit an insurance claim, a high deductible can severely limit the value of an insurance policy.

Deductibles are the amount of a claim that a driver must cover before any payout occurs. For example, if a driver has a $100 deductible and the total cost of a car insurance claim is $1000, the insurance company will write a check for $900 to the driver. A high deductible is problematic because it can leave a driver saddled with most of the costs of an accident. A deductible of $500 or over is considered to be extremely high and can make even a minor accident a major financial burden for the insurance policyholder. On the other hand, policies with low deductibles tend to be much more expensive, and for some drivers, low deductible policies can be a waste of money, especially for drivers who only drive a few dozen miles per month.

In order to choose a reasonable deductible, drivers should consider what they could actually pay if an accident occurred. It's best to choose an appropriate deductible before looking for an insurance policy, as this will make it easier to evaluate different options in order to choose a policy that provides the best coverage, regardless of whether or not it offers the lowest possible rate.

Fortunately, it's easy to compare deductibles for various types of coverage when shopping for auto insurance online. Drivers can use auto insurance comparison websites, for instance, which can provide quick quotes from major insurance companies, complete with listed coverage limits and deductibles. Most comparison websites will arrange these quotes by price and provide all of the important information about each quote up front, so drivers can easily see deductibles, coverage limits and premiums before deciding whether to apply for a policy from a particular insurer. Using an insurance comparison website is a great way to see the types of policies offered by different auto insurance companies and to evaluate them by cost, allowing for a much more informed purchase. Drivers who take the time to consider deductibles when buying car insurance will be able to find policies that are more valuable overall, whereas drivers who focus purely on premiums may be in for an unpleasant surprise if they ever need to submit insurance claims.