People mostly think of deductibles in regards to their health insurance, however deductibles also apply to car and homeowners insurance. Picking an amount depends on your personal financial situation. Please consider what your budget can handle in the event that you need to file a claim.

The advantage of having a high deductible is that you can have a lower premium payment. Many people pay for damages to their vehicles and homes right out of pocket to avoid using their insurance.  These people are perfect candidates for taking higher deductibles and saving money on their premium. On the other hand, if you have a low deductible, you will have a higher premium.  This can make it easier on those on a tight budget when a claim needs to be filed.

If your damages are less than your deductible, it would make more financial sense for you to pay for the damages. Standard deductibles are usually $500 or $1000.

Do you know what your deductible is on your insurance policy?

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