Ideas on How To Select Auto Insurance Deductibles in Florida

While almost everyone would like to save money on their auto insurance, as the old saying goes, it can often prove penny smart, pound foolish. For example, did you know that the dollar value you determine for your comprehensive and collision deductibles is one of the most important decisions in the auto insurance purchasing process?  In addition to the policy’s coverage limits, deductible amounts also determine the amount of your monthly auto insurance premiums.

As you probably are aware, all insurance policies including comprehensive and/or collision coverage will contain a deductible. Most deductibles are $1,000, $500, $200, or $100, but deductible amounts do vary by state. Simply translated, deductibles represent the total dollar cost you will be required to pay for out-of-pocket expenses in the event of an insurance claim. For example, if you select a $500 deductible, you will be responsible for paying the first $500 worth of damages.  On the other hand, if your deductible is $100, then you will only be required to pay $100. Generally, the higher deductible you select, the lower your monthly premiums will be, because lower premiums are often associated with higher deductibles, and higher premiums are often associated with lesser deductible rates.

Although it can prove somewhat daunting a task to determine a premium amount you are willing and able to pay now versus a deductible amount you may have to pay in the event of a claim, a top-notch auto insurance agent at a full service insurance agency can better assist you in your in your decision.  In addition to taking into account your monthly income, savings, and outstanding credit lines, your driving history and vehicle’s value also play major roles in determining amounts.

Selecting a high deductible/low premium or low deductible/high premium greatly depends on what you can reasonably afford. For instance, imagine for a moment that you are involved in an auto accident.  Do you have available funds on-hand to cover the deductible amount? If so, what financial impact would using funds have on you and/or your family, and from where would you obtain these funds (i.e., checking, savings, credit)? Keeping in mind that choosing a deductible has a direct impact on the amount you will need to front in the event of a claim, you may opt a higher or lower deductible accordingly.

In addition to the above, you may also wish to consider the amount you are willing to assume at each policy renewal.  In other words, as financial circumstances change from time to time, so should your auto insurance deductibles.

Let’s face it.  Auto accidents are unpredictable at best.  But your driving habits also speak in volumes as does your driving record.  If you have a history of frequent fender-benders or accidents, perhaps, it may be in your best interest to select a higher premium/lower deductible option. On the other hand, the lower premium/higher deductible could also be a consideration factor for those drivers with excellent driving history records.  Be wise and seek advice from your local independent auto insurance agency.  In the event of a claim, you will be glad you did.