Your auto insurance deductible should not be a static number; you should review it regularly and increase or decrease it if necessary. For example, here are some situations in which you should lower your deductible.
You Have Been Driving the Same Car for Years
A high deductible makes sense with a valuable car that will require serious money to fix in case of an accident. Therefore, if you are driving one of the latest car model or an exotic car, a high deductible makes sense because even after you pay the deductible, the insurance will still chip in and top up the repair cash.
However, the kinds of repairs needed for aging cars are usually not that costly, and if you have a deductible for such a car, you might find yourself footing almost the entire repair cost with your deductible. In such a case, it makes sense to lower the deductible so that you can enjoy the benefits of auto insurance coverage.
Your Emergency Cash Reserve Is Dwindling
Your deductible is only as good as your emergency cash. This is because you need to have the deductible cash ready in case you incur an accident. Therefore, it may be alright to have a high deductible if you have thousands of dollars in your emergency cash reserve.
However, consider lowering the deductible if your emergency cash has dwindled (maybe your business is not doing that well these days, or you have been demoted). You don't want to be involved in an accident only to realize that you can't afford the deductible.
Your Accident Exposure Has Changed
If your risk of an accident is high, then you should opt for a low deductible because there are high chances that you will have to pay this deductible sooner or later. Don't forget that you have to pay your deductible each time you make a claim, so you may be required t pay it multiple times a year if that is how often you are involved in accidents.
However, if your risk of an accident is low, then you can safely choose a high deductible because your chances of paying it are also low. Therefore, consider increasing your deductible if you have been driving for a long time and you are an experienced, safe driver or if you no longer drive as much as you used to do.
If you are not sure on how to choose your deductible, give your insurance agent a call before making any changes. The agent will analyze your circumstances and advise you on whether to maintain or change your deductible. For more information, contact a company like Hayes McDowell Insurance Agent.