When do I have to pay my car insurance deductible?

You can avoid paying auto insurance deductibles when the damage is less than what you'd pay out of pocket. Most deductibles range from $0 to $2,000.

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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, largely in the insuranc...

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that ex...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Jul 15, 2021

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Things to remember...

  • A standard auto insurance policy that only includes liability coverage doesn’t have any type of car insurance deductibles
  • If you purchase a full coverage auto insurance policy, your insurance agent will ask you to select an auto insurance deductible for specific coverage options on the policy
  • A deductible is the portion of the loss that you’re obligated to pay before your coverage kicks in
  • You’re only required to pay deductibles for first-party coverage options
  • In most states, you only have to select a deductible for comprehensive and collision coverage
  • The two deductibles can be the same, but you also have the choice to pick different amounts when you feel necessary
  • The deductible that you choose will affect your premiums. If you have a covered loss to your vehicle, you’ll have to pay either the comprehensive or collision deductible before the insurer will offer a settlement. Many times, the deductible is subtracted from your settlement check

It’d be nice if your auto insurance covered everything. While insurance policies do safeguard you, you’re still responsible for paying for some of your damages after you’ve gotten into an accident or have had another auto-related incident.

Luckily, when you build your insurance policy, you can decide how much you want to pay before you can file a claim. This amount is called an auto insurance deductible.

Not all coverage options require you to select a deductible. Some of the policy benefits payout immediately and others require a damage threshold to be exceeded before the insurer will agree to pay for repairs.

These are things you want to know before you buy car insurance. If you don’t already have a car insurance policy, start comparing car rates by using our free tool above!

What kind of policy requires a deductible?

Under the terms and conditions section of your contract, it says that you have a duty to pay for some of your physical damage losses. The amount that you’re required to pay is called a deductible.

A deductible is a dollar amount that you select for first-party physical damage coverage that’s deducted from a covered loss.

Anytime you build yourself a policy with comprehensive coverage or with both comprehensive and collision, you’ll be asked to select one or two deductibles.

The amount of the deductible that you choose will have a direct effect on your personal premiums. Low deductibles for damage to your autos will raise premiums and high deductibles will lower them.

Some drivers only carry auto insurance to satisfy the law. If you’re trying to keep your insurance expenses low by selecting a liability-only policy, you don’t have to worry about deductibles.

Liability policies only pay for third-party repair bills and medical expenses, not your own.

Since the company will only investigate third-party claims filed under a basic policy, there’s no need to charge a deductible.

If a carrier charged a deductible to file a claim to pay for damages that you caused to others, the other party would suffer if you couldn’t afford to pay your loss.

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What auto insurance deductibles can you choose?

Every company offers its own menu of deductible options. Some carriers still offer $0 options for comprehensive and others have deductibles as high as $2000.

You can select the same deductible for both comprehensive and collision, but you also can select two different deductibles as long as the comprehensive deductible is lower than the collision one. Deductibles can range from $0 to upwards of $2,000.

If you have a loss, the total amount of the damages must exceed your deductible for the insurer to investigate and pay.

Your comprehensive deductible is typically lower than your collision deductible because the premium for comprehensive coverage is fairly low on most cars. This is why it’s easy for damages to exceed the amount you’ve chosen.

Comprehensive losses include damages caused by fire, flood, vandalism, falling trees, hail, and other related incidents.

If you have any of these types of losses, you’re obligated to pay the deductible either to the repair shop or by having the amount deducted from your claims settlement check.

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How will filing a claim affect your rates and how can you pay?

Filing a claim can raise your rates the next policy period. Luckily for you, a comprehensive claim is labeled as a non-fault claim.

Since no fault is associated with the loss, it’s not common for your rates to go up. If, however, you have three or more comprehensive claims within three years you can pay a surcharge. If you’re driving your car and you get into an accident, you can file a claim against your collision coverage.

What’s different in this scenario is that you don’t always pay your collision deductible when you have an accident.

In most scenarios, you only pay the deductible that you have when you’re at least 51 percent at fault for the crash.

If you’re not primarily at fault in the loss, then another insurance company is required to pay for your damages. Unfortunately, some insurers try to delay the process.

If this happens, you might ask that your insurer pays for your repairs and you’ll pay out the deductible. Later, after the insurer collects their money, they will reimburse your deductible.

What happens after an auto accident?

If you’re in an accident with someone who doesn’t have insurance, you could be stuck paying your own deductible.

If you build your policy to include extra protection against uninsured drivers with Uninsured Motorist Physical Damage coverage, your deductible will be waived so a loss doesn’t break the bank.

If you file a collision claim, there’s a good chance that your rates will go up. As long as the accident was at-fault, your renewal rates will go up exorbitantly. On average, a single at-fault accident will raise your rates by at least 38 percent.

You never want to file a claim, but if you have to file one, be sure that you have the money to pay for it.

If you’re carrying higher deductibles than you’d like, you should start to compare rates with other companies.

Use an online comparison tool, select different deductible amounts, and see how much it will change your premiums. Start comparing rates by using our FREE tool below!

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