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How to fund and choose the right Auto Ins. deductible

There is no right answer but there are many things to consider when choosing an auto insurance deductible. The auto insurance deductible has two categories Comprehensive (sometimes referred to as “other than collision”), and Collision. Both deductibles are a per occurrence, and not an annual deductible, and they typically vary from 50 dollars to 1250 dollars. The deductible functions

Comprehensive:

Comprehensive coverage examples:

-Weather losses

-Hitting a live animal

-Flying projectile

-Theft

-Vandalism

-Flood

-Fire

-”other than collision”

Strategies:

1) Less premium is tied up in this deductible so carrying a low deductible doesn’t cause much of an increase in premium.

2) Comprehensive deductibles can happen to all your cars at once. For example a hail storm, could damage all your cars and each car would be subject to its own deductible. For this reason it’s good to consider; could you afford your deductible times the number of cars you have?

3) Carrying a lower deductible is easier to sallow when the loss is out of your control. Example: vandalism.

4) Many companies offer a glass deductible "buy back" to 100 for an additional premium. Meaning regardless of your comprehensive deductible your cost for glass only claims is 100.

Collision:

Coverage Examples:

-Hitting an object or another vehicle.

Strategies:

1) More costly coverage, so changing deductible can net savings.

2) Increasing the collision deductible is a great way to pay for increased liability. Example: an extra 250 out of pocket on a deductible is manageable, however carrying 100K and having a 250K claim is not. But they about cost the same on the insurance policy.

3) Carrying a higher deductible when paired with a ROTH IRA, is a great way to put away savings and if a claim occurs pull the money out to cover the deductible, penalty free, or more likely not have an accident and turn the lower insurance cost into savings.

p: (512) 649-8191

f: (512) 535-0495

info@pap-ins.com

12600 Hill Country Blvd. Suite R-275
Austin, TX 78738