What You Should Know About Car Insurance Deductible


Trying to understand your car insurance deductible can be confusing and overwhelming, but it doesn’t have to be. Here we offer you insight on what you should know about your car insurance deductible.

What is a deductible?

You car insurance deductible is the part of the cost you would be responsible for in the event of a car accident or other damage. This is why you should always choose a deductible amount you are comfortable paying.

If you are ever in a car accident or there are other damages to your car, your insurance company would pay the repair shop the amount needed minus your deductible. You would pay your deductible amount directly to the repair shop.

Let’s say you get into a car accident and the body shop estimates the repairs will cost $1,000 and your deductible is $200. Your insurance would pay the body shop $800 and you would be responsible for paying the body shop the remaining $200.

Should I always file a claim?

You always have an option to file a claim or not. In some cases, filing a claim may not make sense financially. Depending on the amount of your deductible you may just decide to pay for repairs yourself.

If repairs come out to $1,000 for example, and your deductible is only $200 you would probably go ahead and file a claim. On the other hand, if repairs are only $100 or even $300, you may want to pay for the repairs yourself without filing a claim.

Is my premium affected by my deductible?

Generally speaking the higher your car insurance deductible, the lower your premium will be. If you choose a low deductible then your car insurance premiuim will be higher. There is a wide range of deductible you can choose from when selecting a car insurance policy.

It is not wise to choose a higher deductible for the sake of saving money on your premium. A $1,500 deductible may keep your premium low but if you are in a car accident and need to pay those $1,500 in repairs, you may be stuck in a tough situation.

Are there different deductibles for different coverages?

Depending on the type of coverages your car insurance policy includes you may have different deductibles and you have to pay attention to these when selecting a policy. Usually you will have comprehensive coverage which would cover theft, vandalism, or fire; and collision coverage which covers you in the event of an accident. The deductible for the 2 types of coverage are not always the same.


Depending on the insurance company and the type of policy you choose, there may be discounts you could qualify for either for your deductible or your premium.

If you are unsure whether you have the right car insurance deductible to meet your needs, have questions regarding your car insurance policy or want a better rate and excellent customer service, contact a Preferred Link agent today.