Choosing insurance is not a popular job for anyone, but it has to be done. When requesting a policy, there is a description of what is covered. This is the most important reference document to have if an accident happens. Some words are thrown into a policy to intentionally mislead the person applying. The best thing to do when ironing out these misleading words, is to question the insurance company. When questioning, make certain you ask to have these terms defined in a language you can grasp. Insurance companies have a lingo, unless you have experience selling insurance this lingo might as well be a foreign language.

While dissecting a possible policy. Pay utmost attention to what will have to paid by the insured besides the premium. This is considered the deductible or excess amount. When this fixed fee seems too high, the applicant is able to design a coverage that suits better.

In most cases, if the damage to a vehicle is more than a set deductible, the best decision is to not file a claim with an established insurance company. Knowing what excess or deductible that will be paid by you, in addition to the insurance compensation is essential.

Do not jump to conclusions when you find yourself in a wreck. First you should investigate the degree of damage done the your vehicle. Then refer to your insurance policy to see how much you will have to pay according to the amount of your deductible and how much the insurance company will compensate. After gathering these facts, weigh out the situation. Will it cost you more by notifying the insurances company, or would it make more sense to keep it to yourself. Any monies that are paid by an insurance company will result in an inflation of the insured payments somehow.

Instead of filing a claim expecting the insurance company to pay for damages, you can utilize the route of receiving a benefit for not filing a claim. You cannot file a claim and use this benefit at the same time, these two options cancel each other. There may be an incentive via a credit to your premium, or a slightly lowered premium. Also you could be entitled to a payment from the insurance company.

When reviewing a policy there will be several types of deductibles. There is one that is a base across the board for every insured consumer that chooses the company. The others are used as a method to raise the amount the insured is responsible for, in order to decrease the monthly amount paid.

Sometimes the choice of an additional deductible is out of your hands. When a new driver is added to a policy, the risk level increases and an extra amount will be added to the original deductible. Another example limiting the choice in this matter, is attempting to add an individual that constantly violates traffic laws, or has frequent accidents.

In summary, deductibles and excesses are explained in the policy. The option to evaluate, and change this amount to be more than the base amount, is up to you.

Graham McKenzie is the content Syndication Manager at Insurance123.co.za South Africans leading car insurance information portal