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teens in carAn insurance deductible is the amount of money a policy holder has to first pay for any losses before the insurance coverage kicks in. In most cases, insurance deductibles are set by the insurance firms and policies are sold with these predetermined deductible values in place. Changing the amount of deductibles paid on a certain policy is possible with most customers opting to pay lower deductibles. Choosing to pay a higher deductible may seem like a bad idea but, to the right individual, it could present several benefits.

First, the insurance premium paid for policies with higher deductibles is lower. 

The amount of premium charged by insurance companies is higher if the financial loss that would occur due to accidents is high. However, if a customer pays a higher deductible he will have to pay a higher figure for the financial loss caused by any accidents. This reduces the amount of compensation money paid by the insurance firm to the customer thus the insurance firm charges a lower insurance premium.

Secondly, the amount of financial loss to the customer due to failed claimed for the policy is lower. 

In some cases, customers may pay insurance premiums for many years without ever making a claim. Money paid for the premiums in such cases could be viewed as lost money. However, if a higher deductible is paid, the amount of premiums paid should be lower in the long run leading to a lower financial loss in case that no claims are made.

Thirdly, paying a higher deductible increases the property owner’s level of responsibility and care while handling insured property. 

People sometimes handle insured property without being too keen since the insurance should cover any damages in case of accidents. If a higher deductible is paid one is aware that they will also suffer financial loss in terms of deductibles before the insurance cover kicks in. This increases the level of responsibility while handling insured property.

Fourth, higher deductibles also lead to insurance coverage being more affordable. 

In most cases, insurance coverage is not affordable to most people because of insurance premiums are too high. However, by charging higher deductibles insurance companies can ask for lower premiums on their policies making them affordable to more people.

Lastly, a high deductible reduces any immediate financial strain to the policy holder which can be caused by high premiums.

In cases where it is in the policy holder’s best interest to pay low premiums, choosing a policy with a high deductible reduces any immediate financial strain. Over time, this savings could far outweigh the one-time cost of the higher deductible. 

For more information on Ohio auto insurance deductibles, your insurance policy, or to receive a new quote, please feel free to contact Tom Jones Insurance directly at: 740-467-2040
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NOTICE: This and all content is developed from sources believed to be providing accurate information. The information in this material is not intended to be used as tax or legal advice. Please consult with a tax and/or legal professional for detailed information regarding your individual situation. Some of this material was developed and shared by Tom Jones Insurance to provide information that may be of interest. Tom Jones Insurance is not affiliated with the named representative, broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.
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