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When you’re shopping for insurance, you want to find the deal that is best for you. With so many variables to consider, however, it can be hard to determine what that best deal actually looks like. Expensive vs. cheap premiums, high vs. low deductibles, comprehensive vs. catastrophic coverage: There is no one-size-fits-all approach to buying insurance. You’re not alone if you’re wondering “Should I choose high or low deductible coverage?” This guide is here to help you understand what is best for your business.

High vs. Low Deductibles and What It Means for You
On a very simple level, the easiest way to understand the effect your deductible has on your coverage is the way it interacts with two elements: your premiums and your protection. Although there are other factors that also have an effect on your final costs, as a general rule, the higher your deductible is, the less money you have to spend on your monthly payments, and vice versa.
So what is the difference of high vs. low deductibles when it comes to your coverage when you need to file a claim? This is where the trade-off for lower monthly costs comes into play. Your deductible represents the money that you have to pay out of pocket before your insurance coverage kicks in and begins covering some or all of your costs. That means that if you have a higher premium with a lower deductible, you will pay less out of pocket, while a higher deductible and lower premium mean more than you need to pay before you are covered and that’s the basics of High vs. Low deductibles.

Choosing High-Deductible Coverage
Deciding on high vs. low deductibles comes down to assessing your risks and what you need to be covered. Companies that are unlikely to face claims against their policy are prime candidates for choosing a higher deductible. Although there is more risk in the event of a claim, your primary goal is having the coverage you need for regulations and to protect against a single catastrophic incident. Since you are less likely to need to file, you benefit from lower monthly costs.

Choosing Low-Deductible Coverage
High deductibles are an option for companies that are more prone to facing claims against their coverage. If you are in a high-risk field where on-site accidents are more common, for example, you are likely to be better suited for selecting a policy that has a lower deductible. While you will have to face higher premium costs, this protects you from having to pay a high deductible multiple times over the course of the policy if you experience a run of misfortune.

Working With the Coverage You Have
When it comes to high vs. low deductibles, the best option for businesses comes down to the individual need of the business in question. Once you decide on high vs. low deductibles and which is better suited for you and your business, you can work to fine-tune your policy to your business’s individual needs. Speak with your insurance broker about your options in terms of additional coverages or tweaks to get the most out of your policy.