When it comes to auto insurance policies, the deductible amount that you choose can determine, in large part, the price you will pay. The higher the deductible amount, the more money you save on your monthly premium payment amount. Many auto insurance consumers, however, choose their deductible amount by how much they can bear to pay if they should have an accident. In other words, they make a psychological choice instead of a choice based on the state of their finances.

Many consumers could pick a higher deductible in their auto insurance policy, but psychologically they choose a lower amount because they cannot bear the thought of paying more than a certain amount of money in case an auto insurance claim should be necessary. The thing to keep in mind, in this case, is that the savings that the consumer would receive on a monthly basis by choosing a higher deductible on their auto insurance policy would more than pay for the deductible amount they might have to pay in case it should become necessary.

Because of these savings, I would only recommend a low deductible amount to those that are accident prone, and know that they will need to pay such an amount on an auto insurance claim sooner, rather than later, and on a more frequent basis. For the great majority of consumers however, a higher deductible makes sense. And, it even makes more sense if the consumer is able to channel the savings into better coverage and protection in their auto insurance policy.

Just something to keep in mind when discussing coverage amounts with your family members or insurance agent. Let me know what you think – higher deductible or lower deductible amount? How has the deductible amount on your auto insurance policy affected your rate? How often do you have to pay this amount? Until next time…

Tags: Auto Insurance, car insurance, consumer advice, Deductible, insurance coverage, Insurance policy, Personal Injury Protection, Property damage, Traffic collision, Vehicle insurance

This entry was posted on Saturday, April 24th, 2010 at 12:51 PM and is filed under Auto Insurance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.