I was pricing insurance for my $10,000 Rolex.
Option A: $1,000 deductible for $140/year.
Option B: $0 deductible for $175/year.
I chose Option A to save $35 per year. Six months later, I smashed the crystal—an $800 repair. Because my deductible was $1,000, insurance paid nothing. In effect, I self-insured against the most common type of damage.
Key Takeaways
- Watch Claims are Often Small: While theft is total, damage (crystals, bezels, water) is often partial ($500 – $2,000). A high deductible renders your insurance useless for 80% of claims.
- The Premium Difference is Tiny: Moving from $1,000 to $0 deductible often raises the premium by less than the cost of a nice lunch.
- The “Psychology of Use”: If you have a $0 deductible, you wear the watch without fear. If you have a high deductible, you baby it. Insurance is for peace of mind.
- Hodinkee Standard: Hodinkee/Chubb defaults to $0 deductible for this reason. They want you to use the coverage.
The “Why” (The Trap)
The trap is “car insurance thinking.”
With car insurance, taking a $1,000 deductible can save real money because premiums are high—often $2,000 a year or more.
Watch insurance is different. Premiums are low (around $150 a year). Saving 10% on the premium only saves about $15. Risking $1,000 to save $15 is bad math.
And unlike cars, watches don’t have “fender benders.” They have “crystal smashes.” Repair costs almost always cluster near the deductible, leaving you stuck in the dead zone where insurance pays nothing.
The Investigation (My Analysis of Quotes)
I ran the numbers for a $20,000 collection.
Jewelers Mutual
- $1,000 Ded: $220/year.
- $500 Ded: $240/year.
- $0 Ded: $270/year.
- Analysis: For $50 extra, I get $1,000 more coverage on every claim. If I break one crystal in 20 years, the $0 deductible pays for itself.
Hodinkee
- Standard: $0 Deductible is baked in. They don’t even let you choose a high deductible to lower the rate usually.
[IMAGE: Bar chart comparing “Out of Pocket Cost” for a $1,200 repair with different deductibles]
Comparison Table
| Deductible | Annual Premium | Customer Pays (on $1k Claim) | Insurer Pays |
| $0 | $270 | $0 | $1,000 |
| $500 | $240 | $500 | $500 |
| $1,000 | $220 | $1,000 | $0 |
Step-by-Step Action Plan
- Check Your Policy: Log in. Look at the deductible line.
- Run the Quote: Ask your agent: “How much to lower my deductible to zero?”
- Switch if <$100: If the cost is less than $100/year to go to zero, do it.
- Reserve Claims for >$500: Even with $0 deductible, don’t file for a $50 scratch. It’s not worth the paperwork or record impact.
FAQ
Does a $0 deductible make my rates go up later?
Not necessarily, unless you file multiple claims.
Why do homeowners policies have high deductibles?
To discourage small claims. Watch policies are specialty products designed for specific item protection.
What is the “Minimum Earned Premium”?
Some policies charge a minimum (e.g., $50) regardless of the deductible.