The Murzzy Blog
Car insurance is as complicated as buying your first car. Knowing the coverages that you need is important to ensure protection, but it can also be confusing. For those who are clueless about auto insurance policies, a deductible may be a word that is unfamiliar. However, knowing about deductibles is essential to understanding your car insurance policy.
To help you out, here is everything that you need to know about deductibles.
Defining a Deductible
Basically, a deductible is the money that you are expected to pay from your own pocket before the car insurance policy starts to kick in. When you reach a certain amount that your agreed to pay for with your insurer, they will start paying future bills that are a part of your claim.
Deductibles differ depending on the type of insurance policy that you have. There are also policies that offer zero deductibles but come with higher monthly premiums.
How It Works
Most insurance companies offer different amounts of deductibles so you can choose which amount you are most comfortable with. The amount can range from zero up to $2,000 and you are free to make your choice. How it works is that when you choose a deductible of $2,000 and you file a claim for a car accident worth $3,000, you have to pay the deductible amount with your own cash. This means that the insurance company will only cover $1,000 of your bills.
A good thing about having a high deductible is that you pay a lower monthly premium compared to those who have a low amount or no deductibles on their policy. In the event that your car is totaled, your insurance company will give you the value of your vehicle minus your deductible. For example, your car is worth $5,000, you will receive $3,000 from insurance company minus the deductible of $2,000.
Determining the Proper Deductible Amount
The general rule is that the lower your deductible is, the more risk the insurer is taking for you, which will increase your monthly premiums. The best thing to do is to find a deductible amount that works best for you and that you can afford in the event of an accident. A good deductible is something that is high enough to cover scratches and dents on your vehicle.
In many cases, a deductible of $1,000 is deemed perfect by most car insurance companies. It’s not too expensive that you can’t save enough for a time of emergency. It also keeps your monthly premium balanced and is high enough to cover small repairs on your car.
If you’re still unsure about the amount of deductible you need for your policy, you can talk to a trusted car insurance agent from a good company. At Murzzy SRI Inc., our mission is to ensure that we protect are clients and offer them policies that they can afford. Learn more about our products and services by calling our agency at (877) 929-2612. Get your free quote today by CLICKING HERE.
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