What is the difference between a premium and a deductible?

Every insurance policy has a set premium and deductible. The premium is the amount you must pay regularly (generally once a month) to avoid losing your insurance coverage. This premium is usually set based on a variety of factors, such as the type of vehicle you drive and your driving record.

Your insurance policy’s deductible is the amount of money you must pay before your insurance provider will cover any costs. For example, say you have an insurance policy with a deductible of $500. If you are in an accident and your vehicle needs $1500 worth of repairs, you will need to pay $500. Your insurance will cover the remaining $1000.

One way to save money on insurance premiums is to choose a policy with a high deductible – as long as you are able to pay the deductible if an accident occurs. Another way to save money is to shop for your insurance policy carefully. Contact us for free instant auto insurance quotes so you can make sure you are getting the best deal available.