December 20, 2013
Why would a person consider raising the deductible on their insurance policies?
Why would a person consider raising the deductible on their insurance policies?
Because the higher the deductibles, the lower the premiums. Also, when it comes to insurance, it should only be to cover major life events. It is wise to self-insure everything else.
Well said, Katherine. Let’s recap.
A high deductible ($1,000 for example) will reduce your monthly and yearly premiums. A low deductible ($100 for example) will increase your monthly and yearly premiums.
Choose the high deductible and if you have a catastrophe, take the $1,000 out of your emergency fund. That is the purpose of that particular fund and that is why you should have one set aside.
Follow Katherine’s advice in self-insuring on the small matters. Filing multiple small claims is a good way to get you dropped from your insurance company. Apply this advice to home, car and health, your financial future will thank you.