Car Insurance Deductibles
To legally operate your vehicle on public roads in Florida, you must have automobile insurance. The laws specify certain coverage types, so you have few choices to make in that regard. However, there is one very important decision you do need make: The size of your deductible, which is the amount of money you must pay out of pocket following an accident.
In the event your car is damaged, your insurance company will pay for repairs once you have paid the deductible. For example, if you select a $250 deductible and the estimated damage to the car is $2,500, you would pay $250 and your insurance provider would cover the remaining $2,250. Thus, it is essential that you consider with care how much you can afford to pay up front, being aware that your insurance provider will not pay a single dollar until you have met your deductible.
The amount of a deductible, which can range from $100 to as high as several thousand dollars, is inversely proportional to your premium: The higher the deductible, the lower your premium. For example, the difference between a $250 deductible and a $1,500 deductible could be as much as $500 in annual premium charges.
Here are some things to keep in mind. What are the chances of you being involved in an accident; that is, what sort of driver are you? How much money is available to you for the deductible and from where?
Bottom line, be sure that you can afford your deductible. If you can’t pay it, the savings you earned.