Delaney Simchuk, Car Insurance Writer
@delaney_simchuk
Yes, a higher deductible means a lower premium, in most cases. By choosing a higher deductible, you are agreeing to pay more out of pocket in the event of a claim, so you will pay less for your monthly premium in exchange.
How Increasing Your Deductible Can Lower Your Premium
| Deductible | Monthly Premium | Difference |
| $100 | $240 | NA |
| $250 | $182 | 27% lower than $100 deductible |
| $500 | $129 | 29% lower than $250 deductible |
| $1,000 | $89 | 31% lower than $500 deductible |
| $2,000 | $84 | 6% lower than $1,000 deductible |
Note: Rates are for a six-month collision coverage policy, per Progessive.com. Actual rates may vary.
A deductible is what you pay out of pocket when you make a claim before your insurance kicks in, so to decide if a higher deductible is right for you, take into account how much you have in savings, how much you could pay out-of-pocket in the event of a claim, and how often you have to file insurance claims. If you file claims often, you will have to pay that higher deductible each time you file, so a lower deductible may be a better choice.
To learn more, check out WalletHub’s guide to car insurance deductibles.
People also ask
Is a $500 or $1,000 deductible better?
A $1,000 deductible is better than a $500 deductible if you can afford the increased out-of-pocket cost in the event of an accident, because a higher deductible means you’ll pay lower premiums. Choosing an insurance deductible depends on the size of your emergency fund and how much you can afford for monthly premiums.
How to Choose Between a $500 and a $1,000 Deductible
1. Figure out how much you would save on your...
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