Auto Insurance Louisville KY Serving Louisville for Over 35 years!
(502) 933-2255 | (800) 468-1215
Auto & Home
Insurance
Commercial
Insurance
Life
Insurance
Church
Insurance

Getting any type of insurance is confusing as it is, let alone understanding the deductibles that are written along with it. However, if you are to fully take advantage of your insurance coverage premiums, it is imperative to know what deductibles are. From a layperson's viewpoint, the deductible has to do with the rates of the insurance premiums and the out-of-pocket amount that has to be paid when making a claim.

Understanding DeductiblesNearly all insurance policies are written with deductibles. The deductible is the first part of the twofold process of making a claim from the insurance company. This is essentially the insurers' way of discouraging relatively small claims and making the process convenient for the insured.

To better understand how the deductible works in insurance terms, let's look at an example. Let's say you accidentally hit another car. Repairs for the accident cost $4000 and your deductible is $400. You will have to pay the $400 out of your own pocket before your insurer will pay the remaining $3600.

As said before, the deductibles are the insurers' way of preventing the insured from making very small claims. The process of making the claim is not only inconvenient and time-consuming, but it also involves additional processing costs that don't really benefit anybody. For a relatively small claim, the time, effort and money that are spent in behalf of the insured can prove to be more valuable than the total amount of the claim. Therefore, the deductible saves everybody the added inconvenience of making small claims.

In return, the insurer offers lower premium rates for policies that have large deductibles. So the amount of the deductible you agree to pay will directly affect the amount of premium that you will have to pay. Keeping in mind this relationship between the deductibles and the rates of insurance premiums, it should be easy for you to select a plan that best suits your budget and coverage needs.

How to decide between a higher or lower insurance deductible?

- Probability of having a claim – You’ll never be able to predict when you will have an insurance claim, but you can consider factors that should give you an idea of your odds of being in an accident.

- Determine your finances – Determine how much you are capable of paying before you decide on the amount of your deductible. Don’t choose a deductible that is more than what you are capable of paying.  

Deductibles are a part of nearly all types of insurance. The implementation is largely consistent, with the exception of health insurance. Since the number of health insurance claims are difficult to determine, health insurance providers settle with a yearly deductible on top of the insurance premiums. These are just the basics of deductibles. It will be to your advantage to fully understand deductibles as well as other terms and concepts of insurance before choosing a policy. Your local independent insurance agent can answer any questions you have and help you find the right policy for you and your family.


By Matt Reynolds - Google+
Share |


No Comments


Post a Comment
Name
Required
E-Mail
Required (Not Displayed)
Comment
Required


All comments are moderated and stripped of HTML.
Submission Validation
Required
CAPTCHA
Change the CAPTCHA codeSpeak the CAPTCHA code
 
Enter the Validation Code from above.
NOTICE: This blog and website are made available by the publisher for educational and informational purposes only. It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state. By using this blog site you understand that there is no broker client relationship between you and the blog and website publisher.
Blog Archive


View Mobile Version
 
  Connect With Us: Social Social Social Social Social
Icon
Site Links

Home
Get A Quote
Our Companies
Testimonials
About Us
Contact Us

Claude Reynolds Insurance Agency, Inc. BBB Business Review

Louisville Auto Insurance Review

Icon Visit Us

Claude Reynolds Insurance Agency Inc.
6801 Dixie Hwy Suite 232
Louisville, KY 40258
Phone: 502-933-2255
Fax: 502-933-5057
Map & Directions
Claude Reynolds Insurance Agency Inc. | 6801 Dixie Hwy Suite 232, Louisville, KY 40258 | 502-933-2255
Powered by Insurance Website Builder | Online Marketing by One Thing Marketing