Higher Deductibles Can Give You Large Savings On Your Car Insurance Policy

One of the best ways to lower your car insurance costs and see significant savings is to choose a higher deductible for your policy. Your deductible amount is the amount that you will be expected to pay if you file a claim under that specific portion of your auto insurance policy. There are usually different deductible amounts for different coverage types included in the same car insurance policy, such as medical, collision, and comprehensive.

The deductible amounts for the comprehensive and collision portions of your car insurance are usually in the amount of two hundred and fifty dollars, five hundred dollars, or one thousand dollars. By choosing a deductible in the amount of one thousand dollars instead of two hundred and fifty dollars can save you as much as forty five or fifty percent on your auto insurance premiums. A very good idea is to take the money for your deductible and put it into an interest bearing savings account. This way the money is available if a claim happens, but until that time you are putting your money to work earning interest while getting lower car insurance rates in the bargain.

If you live in certain states then No Fault insurance is available as an option to lower car insurance costs. These states limit the ability of motorists to sue for damages, and require insurance that covers the driver and not the other vehicle. No fault insurance requires that each person receives claims from their own insurance company, not the other drivers. No fault insurance also has a deductible, and this insurance covers personal injury protection only, no physical damage. The usual deductible amounts for this coverage are no deductible, two hundred and fifty dollars, five hundred dollars, and one thousand dollars. If you choose no deductible, your car insurance rates will be significantly higher than if you choose the thousand dollar deductible. The same principal applies, with the amount of your deductible being deposited into a savings account to earn interest and the highest deductible possible.

The health insurance you carry may affect the medical deductible you choose. A higher medical deductible can save you some money on your car insurance, but many medical insurance plans will not cover any injuries suffered from an automobile accident. It is a good idea to talk with your health insurance carrier to see what exclusions your medical policy has. You can choose the highest deductible to get lower car insurance costs, but if an accident occurs and you get injured it may cost you if you have a high deductible and your health insurance company denies the claim.

The deductible you choose for each type of car insurance coverage included in your policy will have a huge effect on the amount of money you have to pay for this policy. The philosophy is that the more a claim costs you, the more careful you will be, and so your risks will be lower. Choose high deductibles to get huge savings on your auto insurance.