Auto Insurance Claims 

Smart Shopping with Auto Insurance Claims in Mind

The trouble with shopping for car or SUV insurance is that it can be very expense. And, if that unfortunate accident happens, leaving you to make those dreadful auto insurance claims, your coverage becomes an even more costly deal.

Claims and Future Coverage Costs

You may not realize that when you make auto insurance claims, even minor ones, when your policy comes up for renewal, your premium may go up substantially. Auto insurance companies have quite complicated algorithms which assess the risk of each insured individual.

Let Your Agent Do Some Research

When you make the effort to shop for and find auto insurance, or you decide to update your current policy, ask your broker for advice on choosing a deductible and the savings/costs of a range of deductibles on your premium.

Play the Balance Wheel

A high deductible generally decreases your monthly or annual insurance premium amount. The downside is that you are responsible for the cost of repairing damages to your vehicle, up to that amount.

Think of Consequences

For instance, let's say you find coverage containing a $750 deductible. You need to be prepared to take care of the cost of the repairs out of your pocket or maybe not repair the damages at all. A simple fender bender, sustained by hitting your own mailbox, may not require a police report, but can significantly detract from the appearance of your car, impacting your resale value as well.

Filing Reports

However, if someone runs a red light and causes more than $200 in damage (this dollar amount may vary from state to state) to your vehicle, a police report is required. This means that the accident will be reported to your insurance company and, in any instance, almost certainly hitting your pocketbook with an increase to your premium next time around, regardless of which driver was at fault! Here you have a case of having to make auto insurance claims, whether you like it or not!

Complete Coverage - But a High Price

Choosing a $0 deductible for your policy definitely raises your monthly premium. The up side to this scenario is that any damage is covered, right down to a cracked tail light. The down side is twofold. In order to realize the benefit of no-cost repairs to the car, you will need to complete an auto insurance claim.

Second, if you make more than one or two claims which might have cost just $50-100 each as an out-of pocket expense, your premium will increase automatically. One example that fits this situation involves someone knocking out your tail light, while backing out of a parking spot or any type situation such as this.

Those Radio Thieves can Cost You!

Another common example is the theft of your radio from your unlocked car. However, the insult-to-injury factor arises when you have a $0 deductible, but significant damage to your car in an accident. Your insurance policy will pay for the repairs, but your premiums will be raised outrageously when it's time to renew your policy. Some insurance agencies may even decide not to cover you at all - even if you've been with them for years!

Consultation for Auto Insurance Claims and Deductibles

This is why it is essential to consult your insurance agent or broker, to compare the dollar amount of your deductible against the benefits in your annual, biannual or monthly premiums. If you can afford to absorb the $200 for minor accident damages like a parking lot incident, this decision could reduce your rates by an amount that adds up to $200 a year.

Now, you are more informed and can almost choose what you want to pay for car insurance. In my mind, there is no need to pay a penny more than you have to - within the means of your budget in case auto insurance claims raise their ugly heads.

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