An auto insurance policy that goes beyond the legally required liability coverage ensures you’re financially protected if you’re in an accident under most circumstances. However, with different levels of coverage, deductibles, and premiums, understanding the policy can be difficult. A common question people have is whether it makes sense to save money on premiums by raising their deductible, which is the amount a driver must pay out of pocket for car repairs before the provider covers the rest. Here’s a closer look at how to decide whether this is the right call for you.

When to Raise the Deductible

The primary reason a driver would choose to raise the deductible is to lower their premium—the amount paid each month to keep a vehicle covered. Typically, the higher the deductible, the lower the premiums. However, this means you assume greater risk because you’ll have to pay for more of the needed repairs.

How much premiums will be reduced varies by driver and state. An example of a common low deductible is $250, while many choose $1,000 as a $750 risk they’re comfortable with. Paying out of pocket for repairs may not be a major concern if you’re a safe driver with an exemplary driving record. This is also a viable option if it’s for a vehicle that you rarely drive.

When to Keep a Lower Deductible

While the prospect of paying less money every month for your insurance coverage is promising, it doesn’t always make the most sense for drivers. That’s especially true for drivers who have accidents on their record, as they’re more likely to file claims.

Even if you don’t have many accidents, it’s still smart to keep the deductible lower if you don’t have the extra savings to cover the increased costs of repairs. It’s also best to keep a lower deductible if you’re leasing the vehicle, as you’re responsible for maintaining the vehicle and returning it in an acceptable condition.

 

For more help on deciding whether or not it makes sense to raise your auto insurance deductible, contact the experts at Robert Taylor Insurance. They’ve been serving local drivers in Lorain, OH, for more than 30 years, and they have the experience to navigate your insurance policy to ensure you have the coverage you need at the best price possible. Learn more by visiting them online or call (440) 277-5191 to get a tailored quote today.