Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products, including home, life, auto, and commercial, and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, mainly in the insuranc...

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UPDATED: Oct 14, 2021

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Here's what you need to know...

  • A car insurance deductible is the amount of money that you’re obligated to pay towards damages when you have a covered loss
  • In most cases, deductibles are actually deducted from a claims payment
  • While both comprehensive and collision settlements are subject to a deductible, there’s no deductible when you file third-party liability claims or medical payment claims
  • If you suffer a loss because of fire, theft, vandalism, falling objects, wind, hail or flood, your comprehensive deductible will be deducted from your check issued to pay for repairs or vehicle replacement
  • When a policyholder crashes into another car or an object, their collision deductible will be charged to the claim
  • If you or a listed driver is deemed not-at-fault for a wreck, the other party’s insurance will pay for the loss and you aren’t responsible for paying the deductible
  • Non-fault drivers who’re waiting for a claims decision to be made might still have to pay their deductible for a faster settlement through their insurer
  • If you’re hit by an uninsured driver and you don’t have specialized Uninsured Motorist Property Damage coverage, your claim is subject to a deductible

When you own a car, it’s your legal duty to insure it. As you shop the market for coverage, you’ll notice that there are several different insurance providers who all offer a long menu of coverage options. You can either select a policy with bare minimum coverage options and limits, or a more comprehensive policy with broader coverage options that offer more protection. Compare car insurance rates now by using our FREE tool above!

Even full coverage policies have coverage limitations. When you’re purchasing a policy that’s built with broad forms of coverage, it’s important that you know that you’re still required to pay for some of your own damages regardless of the limits that you’ve chosen. The amount of money that you must pay depends on your coverage and also on the deductibles that you select.

What is a car insurance deductible?

When you buy auto insurance, you’re technically passing on the burden of paying for damages onto an insurer. While the insurer agrees to pay for your future claims in exchange for regular and predictable premiums, the contract requires the policyholder to pay some money towards repairs before a claim can be made.

The amount of money that the insured must pay depends on the deductible that they select.

Most deductibles range between $50 and $2000, with higher deductibles lowering coverage premiums. High deductibles lower premiums because they reduce the likelihood a policyholder will file a claim.

If the damages sustained in a loss don’t exceed the deductible, it’s the vehicle owner’s job to pay for the repairs on their own without any help from the company. This is why it’s important for all consumers to choose a deductible that they can afford to pay. After all, losses aren’t predictable.

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How much will you save with a high deductible?

If you’re in the process of buying new insurance, it’s important to weigh the pros and cons of selecting a high deductible. High-risk drivers and owners of luxury sports cars might benefit from taking the highest option so that their premiums aren’t exorbitant.

If you’re not a high-risk driver, however, taking a high deductible isn’t always the best financial plan. In most cases, the base premium is given to policies with a $250 deductible. Here’s how much you can save if you decide to carry a higher deductible:

  • An average savings of 7% if you raise your deductible from $250 to $500
  • An average savings of 9% if you raise your deductible from $500 to $1000
  • An average savings of 16% if you raise your deductible for $500 to $2000

Are liability claims subject to a deductible?

A liability claim is a claim that’s presented by a third-party driver. If you contact your insurer to inform them of a crash, the claim will be classified as a liability loss when you’re found to be the at-fault driver. This means that your insurer will pay for third-party injury losses and third-party damages.

When filing a claim to coverage third-party damages to others, you aren’t required to pay a deductible.

The payment is, however, subject to the limits that you carry on your policy. You can find these limits on your declarations page.

What coverage options have an automatic deductible?

As you build your policy, you’ll notice that you must select a deductible only when you carry physical damage coverage. Physical damage coverage consists of both comprehensive and collision coverage. Each of these will pay to repair your covered auto after you suffer a loss.

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When do you have to pay a comprehensive deductible?

Comprehensive pays for damages that are sustained in losses that don’t involve a collision. This is why comprehensive is also called ‘Other Than Collision’ by insurance agents. If your car is damaged because of the following types of losses, the comprehensive deductible that you carry will apply:

  • Fire
  • Theft
  • Vandalism
  • Falling objects
  • Wind, hail or other weather-related incidents
  • Contact with an animal
  • Explosion
  • Glass breakage
  • Flood

Will a comprehensive deductible ever be waived?

Some companies have special rules for glass claims. If you file a glass claim for a chipped windshield, you may be able to ask for a deductible waiver. This is an incentive to fix your windshield before it needs to be completely replaced.

When do you have to pay a collision deductible?

A collision deductible is usually higher than your comprehensive deductible. If you’re involved in a collision, you typically only have to pay for your deductible when you’re 50% or more to blame for the loss. If you’re less than 50% at-fault, most companies will pass the burden of repairing your car on to the third-party’s carrier.

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What if there’s a dispute on fault?

Not all claims are settled quickly. If there’s been delays and you need to get your car fixed, you can file your claim through your carrier first and allow them to collect the money later. For this to happen you’ll have to pay your deductible. If you’re found not-at-fault, you’ll receive your deductible back later.

What if you’re in a hit and run accident?

In hit and run accidents you will use your collision coverage and must pay your deductible. Drivers who carry Uninsured Motorist Physical Damage coverage can waive their deductible as long as they can identify the driver who hit them.

Deductibles can get complicated when you have a collision loss, and if you’re not happy with the way that your company settled your loss, you may be interested in shopping for coverage elsewhere.

Make sure to compare premiums for different deductibles before you make a switch. Use an online rate comparison tool to quickly compare costs and then make a decision to select the best deductibles through the best carriers. Enter your zip code in our FREE tool below to compare car insurance rates now!