A car insurance ‘deductible’ is simply the amount that a client is required to pay in the event of a claim before the insurance company pays the balance of the loss up to the policy limit. This is also known as insurance excess. An example is this; an accident occurs and results in 3000 units of damage, the policy deductible or excess is 500 units, meaning that the client will pay 500 units, where the insurance company will pay 2500 units.

The deductible or excess is designed to prevent the insurance company to pay out on minor claims and is a deterrent for claims where the damage exceeds the insurance deductible only by a small margin. Some people see this condition of a policy to be unfair to drivers as it seems to go against the whole reason why insurance is required in the first place. For example, the job of having a policy is to protect the client financially in the event of an accident, therefore why should the policy holder be responsible for a part payment when they already pay a premium to cover that exact scenario?

Whether you agree with the idea of paying a deductible or excess charge or not, they are part of the underwriters terms and conditions for car insurance.

The amount that one person is required to pay before the insurance company varies depending on the type of policy as well as the insurance company and country that the cover is intended for. It is important to understand that the level of deductible or excess can usually be chosen by the client, this is not always the case however. The amount that is agreed for any policy is then susceptible for payment on each and every claim. Of course it is impossible to predict whether an accident will occur, however if a client has a long history of driving with no or little claims, then a policy with a high deductible or excess may be suitable. As paying a higher level of deductible/excess results in lower premiums, long term this could be beneficial. Alternatively, if a client has a history of making regular claims then a low deductible/excess figure may be worthwhile on their policy. This will however result in a higher premium cost.

Choosing the right level of deductible/excess on a car insurance policy will vary depending from driver to driver. Really it is a balancing act between receiving low premiums and minimising the level of deductible in the event of a claim. A short term saving in premium can result in a long term expense through the car insurance deductible.

Incoming search terms:

insurance deductibles explained, deductibles are unfair, No insurance excess (deductible), instant car insurance quote, insurance deductible each and every claim, insurance deductible is unfair, car insurance deductible explained, Level of deductible, No insurance excess (deductible) meaning, what is deductible insurance for car, how to explain deductibles for Auto insurance ON, excess car insurance explained each and every crash, car insurance dedutibles explained, cheap car insurance young drivers, country insurance deductibles, deducible each and every claim, Deductible and Excess in claims, deductible condition for auto insurance, deductible excess for each claim, deductible explained

Related posts:

1. Car Excess Insurance Explained
2. Car Hire Excess Insurance Explained
3. Introduction to Car Insurance Write-Off’s
4. A Guide to Rental Car Insurance Coverage
5. An Introduction to Pay As You Go Car Insurance