Welcome to Part 2 of Time Off the Clock with Block!
Now that we've figured out state-minimum liability limits are too low, in Part 1, what other mistakes are you making on your auto policy that could be costing you money in the long run?
Mistake #2: Setting a way-too-high deductible
What is a deductible?
A deductible is your out-of-pocket cost to help pay for damage to your vehicle.
If your insurance company pays for your repairs, you pay your deductible. Your car insurance deductible must be paid every time, no matter how many claims you file that year.
Let's think about this!
You have a $1,000 deductible and you drive from your home in Paragould to Jonesboro every day, you've had 4 fender-benders this year (YIKES). For most people, that $4,000 worth of deductibles coming out of your pocket takes a toll on a budget. Let's be real, it would be pointless to file a claim if the total damages each time were under your deductible amount. This is all coming out of your pocket!
Is it worth it?
So why do some people decide to have such high deductibles? It's simple, most insurance shoppers choose those higher deductibles so their premium will be lower. Yes, those higher deductibles might save you money on your premium but if you were to get in an accident tomorrow, could you afford that high deductible?
When choosing your deductibles, ask yourself how much can I truly afford to pay in the event of an accident and do not set your deductible higher than that amount. Can you pay $1,000 out-of-pocket? Great! Is a $500 deductible a better fit for you? Awesome!
Insurance is not one size fits all.
Find what deductible works for you!
As always thanks for taking Time Off the Clock with Block!
If you have any questions, give us a call, shoot us an email or drop by any of our locations!