Auto Insurance - Choosing Deductibles

Comprehensive and Collision DeductibleWhat are auto insurance deductibles? - It's what you pay in case of a comprehensive and collision (abbreviation: comp/coll) claim which pays for physical damage to vehicles listed in your policy. In a sense, it's the specified amount money, (deductibles) that you pitch in towards your vehicle's repair or replacement. It is important be properly informed in order to make a smart decision when choosing deductibles. This coverage is what may protect your vehicle in case of an at fault accident.

Choosing auto insurance deductibles is a matter of preference. There is no "better" choice in general. The best choice is what best suits a policyholder's specific needs. Although deductibles can sometimes be set at different amounts for each comprehensive and collision, they usually are the same. The following should help decide which deductibles to choose.

The most common choices of deductibles are as follows:
  1. $0-$100 deductibles:
    • Least common;
    • May be expensive.
  2. $250 deductibles:
    • Less common, usually for those within the preferred market (those with low risk factors);
    • May increase rates considerably but may be a good idea to quote.
  3. $500 deductibles:
    • Among the most common choices;
    • May not be the cheapest
  4. $1000 deductibles:
    • Among the most common choices;
    • Among the least expensive.
Anything above that is uncommon and may not be practical because for example if you have a $2,000 deductible, that's what you will have to pitch in towards your vehicle repairs or replacement. What if the damages only amount to $1000? The whole point of comp and collision coverage is to help you avoid the expense involved the damaged or total loss of your vehicle.

An important factor in choosing deductibles is price. To find out the difference in prices, get auto insurance quotes on different deductibles and compare the differences to help make a choice.. This way you can take all option into consideration an make a good choice based on your needs.

Keep in mind the following pointers when choosing deductibles:
  • The lower the deductible:
    • The least you will pay in case of a claim;
    • The higher the premium will usually be.
  • The higher the deductible:
    • The more you will have to pay in case of a claim;
    • The lower your premium will usually be.

Related Topic: Help choosing auto insurance coverage to fit the needs and budget.


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