If you are new to car insurance, then first you need to understand what is a deductible. This is the amount that you pay out of your own pocket for your car repairs before your carrier will foot the rest of the bill. Recently, more and more car insurance companies are offering the vanishing deductible to reel in potential policyholders. We will be discussing this exclusive offer in this article.
How does it work?
So basically, just like any other car insurance policy, there will be deductibles on your collision and comprehensive coverage. The vanishing deductible scheme will give the policyholder discounts for their deductibles if they meet the criteria required by the carrier. The amount has no cash value and is only applicable to deductibles.
What are the criteria?
These things will vary since each car insurance company has its own requirements. But typically, a policyholder can avail of the vanishing deductible if they haven’t been involved in an accident for a full year. If they did not commit any significant traffic violation within a year and if they have no coverage lapses. If the policyholder can meet these, they can avail of a $50-$100 discount on their deductibles.
What’re the benefits?
The obvious benefit for the policyholders is that they can save money. It isn’t money that they can spend on anything else, but it saves them hundreds of dollars worth of deductibles. If ever they get into an accident, they wouldn’t have to pay out of their own pocket. Also, it encourages safe driving. Much more than money, personal safety is the most crucial benefit.
What’s the catch?
The main catch here is it keeps you loyal to your auto insurance company. Switching to other carriers would mean you would forfeit this benefit, so you would have to think twice before thinking about going with another insurance company. Also, if you area safe enough of a driver to earn this reward, most likely, you would never need it. But again, insurance is for unforeseen circumstances.