He finds out the insurance companies do offer something that might help him lower the premium — deductibles. From an insurance company point of view, a deductible is an instrument for sharing the risk. In practice, a car insurance deductible is the amount of money an insurance client must pay for repairs before insurance covers the rest, in the case of a claim. In Peter’s example, the insurance company he would like to insure the car with offers a 30 % discount on his yearly premium for a 1000 EUR deductible. This would mean that for a 30% discount on the premium Peter will have to pay the first 1000 EUR of damages himself and the insurance company will then pay what is left of the costs to repair the damage.
Option A: The insurance premium without deductible: 1100 EUR/year
Option B: The insurance premium with 1000 EUR deductible: 1100 EUR — 330 EUR (330 = 30% * 1100) = 770 EUR/year
For a total immediate saving of 330 EUR Peter is exposed to 1000 EUR deductibles in the case he has an accident and files a claim. Even though he thinks there is a low probability he will file a claim Peter still feels the risk of having to pay the entire sum alone is too high and that he might struggle to cover the entire amount of the deductible himself in the case of a claim.
In the next post, we will meet Peter’s friend Sarah and see how she uses VouchForMe.
Until then, you can check the VouchForMe and share your existing motor or health insurance at
https://pls.vouchforme.co/.
maybe in future add some real cases for healthcare insurances
