Auto insurance (such as is provided by Colling Insurance Services, Inc) is supposed to give you a peace of mind financially. However, the stress of paying your deductible could give you a huge migraine should you be involved in an accident. That's why it is important to consider all angles when choosing your deductible. Here are some things you should consider before making this choice.
1. Can You Afford It?
This is different for each person, but you should ask yourself if you can afford the deductible you are considering. If you choose a deductible of $500, you should have that amount and more in an emergency account. Choosing your deductible should be a decision made in conjunction with your emergency fund and your income. Choosing a deductible you can't pay is a way of setting yourself up to be in a very uncomfortable position.
2. How Much is Your Vehicle Worth?
How much your car is worth is an important consideration. This will help predict the cost margin of repairs should your car ever need them. The more expensive your vehicle is the higher deductible is recommended. If your vehicle is an older model, a high deductible will prove unnecessary as repairs would be relatively inexpensive. It is best to find your cars worth and evaluate it by its condition.
3. Are You a Low or High-Risk Driver?
Typically, low-risk drivers don't need high deductibles, but high-risk drivers should carry as much insurance available to prevent a financial catastrophe later on. Here are some reasons you may be considered a high-risk driver:
Deductibles are not the same for everyone. You may choose a $250, $500, or a $1000 deductible. When considering a deductible make sure you ask yourself the above questions. The answers will steer you towards a deductible that is right for your pocket.