The Pros and Cons about Adding a Collision Deductible Waiver to Your Policy
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UPDATED: Oct 15, 2021
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The best way to find out if you have a deductible waiver for your collision coverage is to look at your policy or ask your insurance agent. A deductible waiver is an optional type of coverage on your policy, so not every driver has it. It helps decrease the amount of money you would have to pay out of your own wallet in the event you were in an accident.
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Accidents are very stressful. They not only cause damage to your vehicle, but can also cause bodily injury and emotional distress. Add to it the costs that can be associated with them, and you may decide that a deductible waiver is something that will help ease the stress.
What’s the deductible waiver definition?
With any insurance coverage that you have, you also have an auto insurance deductible that accompanies it. This refers to the dollar amount that is required of you before the insurance benefits kick in. The waiver for the deductible can be used if you are in an accident with a driver who has minimal insurance or no insurance at all.
In the event you are in an accident with a driver and it was his or her fault, normally their insurance would be responsible for the cost of the damages.
A collision deductible waiver can save you from paying your car insurance deductible if the uninsured driver is at fault. Even though the collision deductible waiver typically comes at an additional cost, it may be beneficial if involved in an accident with someone who lacks insurance.
If the driver did not have insurance or the coverage amount ran out, your insurance company would be responsible. This also means you would need to cover the deductible for your auto insurance coverage first.
This waiver would allow your insurance benefits to start without you paying the deductible. This is especially welcome if you have a high deductible.
A collision deductible waiver works by removing the insurance requirements that you pay your policy’s deductible before they pay for the rest of the claim. Collision insurance waivers are optional, so you would need to add them to your policy at an extra cost. However, the cost is only minimal, especially when you think that some accidents could cost you hundreds or thousands of dollars.
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What is the cost of a collision deductible waiver?
Although adding a deductible waiver to your collision coverage can save you money in reference to your deductible amount, you may be wondering if the additional expense of your auto insurance premium is worth it. The cost of car insurance varies from state to state, so to get a more accurate idea of how much a waiver would cost, contact your agent.
In the whole scheme of things, the deductible waiver for collision coverage is fairly inexpensive. This is especially true if you have a deductible that is fairly high. The best thing to do is assess your financial situation and decide whether you would rather pay more every month or save monthly and pay a bigger one-time chunk in the event uninsured driver hits you.
Also, consider what your deductible is. A high deductible would orchestrate that possibly purchasing the rider would be a great idea in order to save your own money. If you have a lower deductible and will not have an issue paying for it, it might be a better idea to not get the waiver and save money.
Is there additional protection against uninsured motorists?
According to the Insurance Information Institute, 13.8% of drivers did not have insurance in 2009. This is a fairly high percentage and it is a good idea to make sure you are covered if you happen to get in a collision with one of them.
As of February of 2012, 49 states have mandated that every person who drives on the road carry some kind of auto insurance, especially liability insurance. Each state sets the minimum that is required. Even though these laws are in place, the amount of drivers driving without proper insurance remains high.
Adding a collision deductible waiver is not your only option in order to protect yourself from drivers who do not have car insurance.
There is also uninsured/underinsured coverage that you can add to your insurance policy. This will help cover your damages if the other driver does not have sufficient coverage.
Uninsured motorist coverage protects drivers without collision insurance from costs of damages caused by uninsured drivers.
Some states, as part of their insurance laws, require you to carry some sort of insurance against uninsured drivers. Other states leave it as an option. To find out the requirements in your state, visit the NAIC website (National Association of Insurance Commissioners).
If you find that it is a requirement where you live, then it is already on your policy and you know that you are at least partially protected. Take a closer look at your policy and check out your deductible amount. A deductible waiver would further help your bottom line in the event of an accident.
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