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Deal or No Deal








I finally called my car insurance company today to inquire about increasing my deductible. I was given two scenarios:



  • 1. Increasing the deductible on collision from $500 to $1000.

  • or

  • 2. Increasing the deductibles on both collision and comprehensive from $500 to $1000.

Here are the results:

Option 1: Total savings of $60 over 6 month premium. Comes out to $10 a month.

Option 2: Total savings of $70 over 6 month premium. Comes out to $11.67 a month.


 Ugh! I am just not feeling those numbers.


Increasing the deductible wouldn't pay itself off for 4+ years (when the savings equals the extra $500 in deductible I will be liable to pay out if I ever get into a fender bender).


 What do you guys think? Would you go for it?
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Comments

Anonymous said…
I would save an additional $500 in my emergency fund before I change the deductible on the insurance. This way you will know that you have the money to pay the deductible if you get into any car trouble.
January 23, 2008 at 1:35 PM
LLuv said…
I totally agree that it is not worth it to increase your deductibles in order to save $10-15 per month. Another thing people don't think about is that at some point you could be 'grandfathered' in at that low deductible. I am currently locked in at a low deductible on my house and if I were to ever switch to a % based deductible I could never switch back to my low flat amount deductible. Plus being in a fender bender is stressful enough - don't need to add the stress of alloting another $500 to the mix!! ;o) Have a great one!!
January 23, 2008 at 7:36 PM
Anonymous said…
If you have enough in your emergency fund to cover the deductible, I think it's worth it. In MY opinion, EVERY little savings is important because multiple savings of $10-15 in various ways add up to hundreds. So in essence, what you're doing is insuring your own deductible with your emergency fund. The last time I checked, a car accident was an emergency. So why GIVE extra profit to the insurance company when you too can prepare for the "potential" emergency.

Per the comment above, allotting another $500 to a fender bender shouldn't be stressful if you're prepared for it (i.e. the purpose of an e-fund).
January 24, 2008 at 5:56 AM
Dimples said…
@ everyone

Thanks for the detailed advice. I am going to look into lowering some of my other expenses and then make a decision from there. I'll let you guys know what I decide.
January 29, 2008 at 6:44 AM
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