Comments on: Saving on car insurance: Our deductible

By: Cromely

Cromely — Wed, 26 Mar 2008 08:16:14 +0000

There are also some options to look at for liability.

I reduced my liability coverage to the minimum and then added an Umbrella policy. The separate policy gives me much greater protection than auto liability, plus it covers me for liability in non-auto incidents.

Umbrella liability coverage is also fairly inexpensive. So now I have more coverage than with just higher liability in auto for probably about the same money.

By: Donna(mom24boyz)

Donna(mom24boyz) — Tue, 25 Mar 2008 22:24:06 +0000

Have you shopped around on price–when we looked around we found AIG to be cheaper–but we live in a very very very expensive car insurance state (WV). I have lived in two other states CT and MD and everytime I moved my insurance dropped nearly in half, and then it went down even more. Then I moved back to WV and it doubled! The guy warned me and I was like “yep, I know it’s gonna be high”

Anyhow, make sure you shop around, rates can vary. I know we looked at Geico, Esurance, Statefarm, Allstate, and ended up using AIG –they were the cheapest for us, with the same coverages and same deductibles.

By: Jared McLaufghlin

Jared McLaufghlin — Tue, 25 Mar 2008 22:16:37 +0000

The math shouldn’t have to be fuzzy, I just haven’t come up with a good way to really determine what the numbers should be. I know this much, my truck is ten years old and paid off. I don’t have full coverage. If I’d take the amount saved between collision and full coverage and put that in a fund, I’d be able to buy a new vehicle with cash eventually. Basically, some cars aren’t worth full coverage.

I think part of determining that line is your personal capability to repair the darn thing. I’m pretty good at that stuff, so I don’t mind the keeping an older truck running right.

By: Kacie

Kacie — Tue, 25 Mar 2008 19:19:22 +0000

Yeah, the math definitely is fuzzy.

Also, if we file a claim, we can expect our overall insurance premium to go up. I don’t know how high we could expect it to rise.

I like how you showed that in the long run, as long as you don’t need to file a claim, a higher deductible is cheaper.

Thanks, as always, for your insightful comments!

By: joanna

joanna — Tue, 25 Mar 2008 19:03:08 +0000

The math is a little fuzzy, and I never know how to make decisions about insurance stuff.

The bit about “So, if we end up having to file a claim, the $250 deductible would be about $182 cheaper than it would be if we had a $500 deductible ” … this is true if you file a claim every 6 months. If not, the math changes…

If you have a claim after a year:
$250 + (68.70 premium x 2 payments) = $387.40 = A savings of $112.60

If you file a claim every year and a half, the savings to be on the $250 deductible plan dwindles to about $44. If you file a claim less often than that, it’s actually more expensive to be on $250-deductible plan than the $500-deductible plan.

The entire insurance industry is all about risk management, and we have to be too, as consumers of it. Also, we have to decide how much we’re willing to keep on hand in our emergency fund for when the claims do come about!