Insurance Deductible - Info About Deductibles That May Save Money

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Insurance-deductible.com

Cool looking but completely unrelated Asian stock photo

DEDUCTIBLE “LOW-DOWN”

Your insurance deductible is not a big deal until you have to come up with the jack to pay it. Insurance deductibles and claims have nothing to do with Asian art or folklore, but the picture to the right is a cool stock photo so it stays. The prior two sentences don’t belong together, but I’m not being graded on this.

The only reason there is such a thing as an insurance deductible is because it saves money for insurance companies. Anyone who works with an insurance co (or otherwise is an insurance co payee) will tell you an insurance co makes money by saving money. At this point, to keep everything “above board” and make some futile effort toward objectivity I should mention that I am an insurance co “payee” in the field of auto collision repair.

Yes, insurance companies have to make money just like everyone else. I mention this so as to appear insurance co friendly because any and all deemed “unfriendly” by the insurance biz receive great vengeance and perfectly legal yet furious anger. All is fair in love, war and insurance co profitability.

While I’m on a roll weaving in old truisms let me add that whoever said the only two guarantees in life are Death and Taxes clearly published such a remark prior to the advent of insurance premiums.

It goes like this- the deductible helps the insurance co in 2 ways: 1. they get to pay less for each claim and 2. a person is less likely to file a claim if they have to pay money for it. Seems a basic check-and-balance but rest assured that you, the consumer, in no way benefits from the deductible. Well, maybe I shouldn’t say that due to the fact your insurance agent will tell you they can keep your premiums lower by placing a hurdle in the way of people filing frivolous (and costly) claims. Well enough, I will accept that.

Its true, you and I do not directly benefit from our deductibles. I mean, when was the last time your Grandmother sent you a deductible for your birthday? As a kid I can’t remember spending cold snowy afternoons hunkered down with a cup of hot cocoa and a deductible. I’ve never been to Santa’s Workshop, but I’ll bet Uncle Scrooge’s #1 dime that the elves are not slavin’ away 364 days a year putting together the coolest deductibles for all the deserving kids… okay I’ll stop.

Seriously, though there is something useful on this site.

If you’re the type of person filing a claim every 8 months then you will be better off at some other site. The rest of us, however, can use the deductible to our advantage, kind of. The way we do this is by choosing insurance coverage with the highest possible deductible.

In most cases the premium decrease for an auto policy changing from a $500 deductible to a $1000 deductible is 5%. Depending on the sea of variables (driving history, credit score, policy limits, coverage types, etc.) a premium could decrease by as much as 25% by switching to the highest possible deductible.

Quick word of caution- lowering coverage amounts is generally a BAD idea. Less coverage does equal smaller premiums, but becomes a really ugly monster in the event a claim requires cash beyond policy limits.