Understanding Auto Insurance Deductibles

LOS ANGELES - April 23, 2014 - PRLog -- When going about buying auto insurance it is important to keep in mind that the deductible and the insurance policy is not solely based on the vehicle itself. There are a number of other factors that are also included I the cost of auto insurance. One element to the equation is how much coverage you are looking for.  All auto insurance policies have deductibles, this is just a general fact with all insurance providers. The deductible can be summed up as the portion of the insurance policy which you are financially responsible for paying. One way to look at it, is the deductible is the fee to initiate financial coverage from your insurance policy provider in the result of an auto accident. Note that auto insurance does not cover the entire cost of damages, you the policy holder are responsible for a portion of the expenses. How big of a financial portion you are responsible for depends on your agreed deductible, it is noteworthy to mention that this figure varies from state to state.  Some figurative deductible examples can be expressed as $250, $500 or $1000, which would be the amount that you would be required to pay in the event of an accident. For example if you were involved in an auto accident that totaled up $3500 worth of damages and your deductible was for $1000. You would be required to pay the $1000 and your insurance provider would cover the remaining $2500.00. It is a general rule of thumb that the higher your monthly premium results in a lower deductible amount.

One major key element when deciding to purchase an insurance policy, is to carefully consider the deductible. This agreed to amount will be required to be paid every time you are involved in an incident where damages need to be covered financially. Deciding how much you are willing to pay for the deductible is decision that should not be taken likely. Ask yourself in a worst case scenario would you be able to pay x amount of dollars in order to repair your vehicle? Make a note that some auto insurance providers do not offer rental cars with all policies, this would be another figure you would need to consider.

Paying higher deductibles can save you money due to your insurance premiums being lower. To rephrase the previous statement, if you are willing to pay higher out-of-pocket costs, you can lower the total cost of your insurance rate.

Although it might sound like scattered information, purchasing an auto insurance policy does not need to be intimidating. Just remember that you want a policy that covers  your expenses in the event of an auto accident, theft, vandalism or any other instance or combination thereof, where the end result is damage to your vehicle or someone else’s. It is important to be informed of your local city and state regulations so that you full fill the state’s insurance minimums and what types of discounts you qualify for.

For more information on how to obtain affordable auto insurance.

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