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A deductible affects car insurance by determining the amount that a driver needs to pay before their insurance company will cover the cost of a claim. Deductibles also affect car insurance premiums, with higher deductibles generally resulting in lower premiums and vice versa. For example, choosing a $500 deductible instead of a $250 deductible could save a policyholder around 29% on their collision premium.
Deductibles most commonly apply to collision and comprehensive insurance, which cover the policyholder’s own vehicle in different situations. Drivers can choose their deductible amount when purchasing a car insurance policy, and options typically range from $100 to $2,000. Even though a higher deductible can save you money in the short term, it’s important to choose an amount you can afford.
To learn more, check out WalletHub’s complete guide to car insurance deductibles.
People also ask
What is a collision insurance deductible?
A collision insurance deductible is the amount of money that a driver must pay out-of-pocket when filing a collision insurance claim. Collision insurance pays to repair or replace a car damaged in an accident, and a driver must pay their collision deductible before their insurance company will cover the remaining costs.
Collision Deductible Example
Say you are at fault in an accident that causes $10,000 in damage and you have a collision deductible of...
read full answer by WalletHub, Financial CompanyWhat is a collision deductible waiver?
A collision deductible waiver helps drivers save money on their deductible after an accident with an uninsured driver. Collision damage waivers typically apply only to accidents where an identified driver without insurance is completely at fault. A notable exception is California, where collision deductible waivers can be used in hit-and-run accidents.
When a Collision Deductible Waiver Is a Good Idea
Collision deductible waivers are similar to uninsured motorist property damage (UMPD) insurance, so a waiver is...
read full answer by WalletHub, Financial CompanyDo I need collision insurance?
Yes, you need collision insurance if your car is leased or financed. Collision insurance is not required by any state laws, but most lessors and lenders require drivers to have it until the car is paid off. Even if you’re not required to have collision insurance, you should still purchase it if you cannot afford to pay for damage to your vehicle after an accident.
Why You Need Collision Insurance
Collision insurance pays to...
read full answer by WalletHub, Financial CompanyDid we answer your question?
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