Save Money on your Utah Auto Insurance (part 1 - deductibles)

I decided today to write about something that is important to all of us, saving money! With gas prices at all time highs (almost $4 in Provo and Salt Lake) and the cost of oil still rising almost everyday it can be very expensive to drive your car. I have noticed a lot of vehicles with that natural gas sticker on them lately, I think this is becoming more popular. I have also seen many more people on scooters, motorcycles and even bicycles, my wife and I considered a scooter for me to drive to work but the helmet would mess up my hair so I'm still in the car. With prices rising people are looking for ways to save money. Some industry analyst's project that people may stop carrying insurance, some people see it as unnecessary. Hopefully if you are following my blog you are not one of those people but the truth of the matter is that there are people out there that will cancel their insurance. I am going to use my next 2 or 3 entries to go over some ways that you can save money on your auto insurance without going uninsured.

One of the fastest ways to lower your auto insurance premiums is to increase your comprehensive and collision deductibles. Let me first say that I personally do not like to see people raise their deductibles, but it is definitely better than cancelling your policy. I explained in an earlier post what your comprehensive and collision deductibles are so I won't go over that again but I will explain how they work. If you are involved in an accident and it is your fault than you are responsible to pay your deductible before your insurance company repairs your vehicle. Most people in Utah have $500 deductibles but that can range from $0 to $1,000. If you don't want to be responsible for paying anything in the event of an accident than you can lower your deductibles to $0. Just keep in mind that since you are putting your insurance company on the hook for more money they will charge you more each month. So, if you went the opposite way and decided you would be able to pay $1,000 in the event of an accident than your insurance company is liable for less so they are going to be nice and charge you less.

A few things to consider when deciding how much you want your deductible to be are the value of the car and your ability to come up with the deductible money after an accident. I mention the value of the car because if you are driving a 1988 Acura like my old car and it's only worth $300 on a good day than you don't want a $1,000 deductible. If you are in an accident the insurance company will most likely consider the vehicle totalled which means it would cost more to repair it than the car is worth. If they declare your vehicle a total loss and it's worth $300 but you have a deductible that is higher than that then you don't get anything. In situations where the vehicle is worth less than $1,000 you may want to consider liability only. This would give you the least expensive monthly premium but would also mean that if your wreck your car it is gone. Their would be not collision coverage. Talk to your agent to see if it makes sense for you financially, some people can save a couple hundred dollars a year by switching to liability only. If you put that money in the bank than you can use it to buy a new car.

The other factor was your ability to pay the deductible. You don't want a $750 deductible if you have never had $750 in your bank account. If you can't pay the deductible than your car doesn't get repaired. As I mentioned earlier I really don't like to see people increasing their deductibles because inevitably they always seem to have an accident after increasing them and I don't like getting that phone call. If you can afford the lower deductibles than stick with them, you will appreciate it if you have an accident. If you are considering cancelling your insurance policy because you can't afford it than maybe this is a good alternative for you. Speak with your local agent before making any decisions and if you don't have a local agent give me a call. My contact info can be found under the "Local Utah Insurance Agency" link in the right column. As always, drive safely and come back often.