INCREASING YOUR DEDUCTIBLE
“Your recent column on deductibles reminded me of what I found researching the cost of an individual health insurance policy last fall. In the most extreme case, to go from a $500 annual deductible to a $200 deductible, the monthly premium went from $115 per month to $194. The possibility of saving $300 in expenses increased the annual premiums by $948 or by 316%. Other policies had increases of 176%, 200% and 232% to go from a $500 deductible to $200.” – Erik Sten
A.T.: Moral? Check your current insurer (for health or auto or homeowners) and find out how much you could save going to a higher deductible. Often, it’s worth it.
“Another reason not to file a claim if the amount is slightly more than the deductible: I recently had to replace a broken windshield. The first thing they asked was whether I had insurance or not. The cost for replacement if they billed the insurance company – $850. If I paid out of my own pocket – $200.” – T.K.
A.T.: Depressing, no? And even where it’s not fraudulent, there’s a point to be made. My convertible roof was just slashed (again). To get a new roof is $1,500. To get a waterproof patch is $50. Because it’s a beat-up old car by now anyway, it would be dumb to go for anything but the patch. Yet by buying ‘comprehensive’ insurance (which I don’t), I am in effect paying a premium that not only covers the insurer’s overhead and profit, but also covers all the people who DO go the $1,500 route. (Well, it’s insured, so why not?) Yet another reason to self-insure, when you can afford to, and make your own economic choices.
* * *
MORE TELEMARKETING TALES
From Uvarov: “A friend of mine said he told a telemarketer, ‘My favorite show ends in 10 minutes. Hold on and we’ll talk.’ The caller said, ‘FOR TEN MINUTES!!!’ He got rid of the telemarketer.
“I was a telemarketer in high school. The first call I made, inviting the woman and her husband to a dinner, she said, ‘If you don’t know, my husband is dead, and you shouldn’t be calling.’ Ouch.”
Quote of the Day
What's so fair about eliminating the interest deduction on your first car but not on your second home?~Murray Weidenbaum
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