To lower their car insurance premiums, many people increase their deductibles. You can cut as high as 40% off your premiums by increasing your insurance deductibles.
This is only possible if you have enough money to cover your deductible in the event of an at-fault collision. You may not have the money you need to pay your repair bills. Your car might not be repaired in a timely fashion if you can’t access it easily. Worse, you may be required to pay for some damages to another person’s property. People who don’t have a lot of money must lower their deductibles. However, this often means that they have to pay higher premiums in order to achieve their goals.
Can you lower your deductible while still keeping your premiums affordable?
This goal can be achieved in many ways. Although each method requires planning and discipline, anyone can achieve this goal with a low deductible or a low premium.
You can first choose to insure with a company that offers a “vanishing-deductible” program. These programs allow you to lower your deductible by a fixed amount every year that you are not injured or have no claims. Some programs allow you lower your entire deductible, while others allow you to reduce your liability or collision deductible. Different companies offer different amounts and rates for the deduction. To find the best program for you, compare them.
Another option is to set up a plan that gradually reduces your deductible and slowly increases it every six months. Let’s say your current deductible is $250. This is the minimum your company will allow. Imagine that your deductible is $500 and you save $100 each renewal period. You could save $100 on your premiums and still have $250 left over. This would give you $450 per year. That’s almost enough to cover your new deductible. Continue to save money to gradually increase your deductible to $750 and then $1000. If your company allows, you may be able to increase your deductible even higher. Your premiums will drop as you gradually increase your deductible. This will allow you to save money on the amount you will have to pay for the higher deductible.
A company that offers accident forgiveness is also available. Accident forgiveness allows you to be “forgiven,” if your accident is less than a certain amount of total cost. If you are involved in a minor accident, this is a great way to save your deductible. If the accident is minor, you can save money by paying for the damages yourself. This will allow you to keep your premiums low and avoid unexpected increases in your automobile insurance.
You can also lower your deductible by applying for a reduction in your deductible with your insurance company. This can be offset by any discounts that may be available to you. You may not be taking advantage of all discounts available, which could result in savings that could help you pay a lower deductible.
Make sure you consider all deductibles that apply to your entire policy. You may have separate deductibles for each policy if you have full coverage. This includes liability, comprehensive, collision. You may also have a deductible to cover uninsured motorist coverage. The deductible for uninsured driver coverage is set by law in some states. You cannot increase that deductible, even if it’s your choice. Most states allow you to raise or lower the deductibles for your comprehensive and collision policies.
