logo logo

Higher Deductibles Slash Rates

hd-2Shopping for lower prices on insurance doesn’t mean you have to give up all the coverage. In fact, some insurers provide the same good coverage at lower rates. Higher deductibles may lower premiums and be a huge financial benefit to slash rates.

It’s not only smart to take the higher deductibles as part of a new insurance policy, but it makes sense over the course of the long term. According to the National Drivers Institute, drivers living in the eastern U.S. pay an average of $400-$1000 per month for auto insurance premiums. By raising your deductible, you could find yourself receiving a 10% discount on your monthly premium. That could equate to a $100 savings in a month or $1200 savings in a year. The savings depend on where you live and how much you pay for insurance.

When you raise the deductible it means that it is the amount of the insurer’s out-of-pocket expense that the owner of the car will incur and be responsible for if and when they get into an accident. Typically, you can cut as much as 10% on your car insurance premium just as long as you are comfortable paying a higher deductible.

Sure, it’s a risk for the owner but it will save a lot of money on your monthly premium. If you are very cautious when driving and feel confident about your driving skills, this could be a great way to save money.

Let me provide you a more concrete example: Say you crash into a pole and the repair estimate is $3500 to fix your car. Your deductible is currently $500. This means that you will have to pay $500 to fix your car and the rest of the $3000 will be paid by your insurance company.

The cost for you is higher when you get into an accident and less for your insurance company. If your deductible is $1000, then the company will pay $2500. You pay the $1000 deductible. But if you don’t get into many accidents, it could be well worth your while to save that money every month.

Higher deductibles can also be taken out on homeowners insurance, and a variety of rental insurances. The decision of course is left to the consumer, but it’s just one of many wise ways you can save money on insurance shopping for coverage on Wise Insurance Quotes.