By June 22, 2007 0 Comments Read More →

Car insurance deductibles

Reader question:

Should I get a high deductible or a low one?

Greg

Great question, Greg.

It’s all on you, really. Deciding whether or not you should get a higher deductible is a matter of personal preference. There are some reasons to recommend it over getting a lower deductible, but the same is true the other way around. Higher deductibles mean that you’ll be paying less for your actual coverage, but more when you have to file a claim. Lower insurance means you’ll probably be paying pretty high rates for coverage, but quite a bit less if you chance to get in an accident.

One thing to consider is what your likelihood of getting in an accident is. This is obviously never certain, because there’s always the chance that, even with defensive driving, the other guy might hit you. But if you have a fairly good driving record and, short of a disaster, are not very likely to go colliding into other cars, you might want to opt for a higher deductible, if only because it’s probable that you’ll never have to pay a deductible at all.

Lower deductibles, though, should be considered if you’ve gotten in an accident before or consider it very possible. You might be tight financially, but if you consider the difference between about twenty dollars a month and having to fork out a few hundred to a few thousand if disaster strikes, imagine what you’re bank account will look like then.

Cheers,

Fashun Guadarrama.

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