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Choosing the correct deductibles for your AZ car insurance

Posted on: December 1st, 2009 by admin

What parts of my AZ car insurance policy will have deductibles?

There are 2 areas that most people carry deductibles on their policies, comprehensive and collision. Comprehensive (also known as other than collision) covers most incidences resulting of damage to your vehicle that are not related to collision such as fire, theft, vandalism, glass breakage, hitting a deer, wind or hail. Collision covers damage from colliding with another object, for example hitting another vehicle or running into a post.  

Why do I have to carry a deductible?

When you carry deductibles on your AZ car insurance policy you are taking on additional responsibility to anything that may happen to your vehicle. Let’s say you have a $500 deductible on your comprehensive and you have a crack in your windshield. To repair the windshield the repair shop says they can repair it without having to replace the whole windshield for only $250. Since your deductible is $500 there is no point in filing a claim so you pay the $250 out of pocket. The higher the deductible the fewer the claims the insurance companies receives in return they lower your premiums because you are viewed as somebody with the odds being are that you will not make a claim.

What are the appropriate deductibles for my AZ car insurance policy?

One of the ways for determining your deductibles is to figure out what your breakeven point will be. By breakeven I mean finding out how much of a discount you would receive from increasing let say your collision deductible from $250 to $500. With that discount figure out how long it would take with no collision claims being made to accumulate more than $250 ($500 – $250) of savings. Typically if it will take you longer than 5 years to breakeven it probably is not a good idea to raise your deductible. (Note on average most high risk drivers find the biggest discount to raising their deductibles)

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