How does a car insurance deductible work?
There's no such thing as meeting your annual deductible like there is for health insurance. Instead you have to pay your deductible with most claims, no matter how many you have per year or the lifetime of your policy. Also, your insurer only pays for damages above your deductible. For example: If you have $300 in damages and a $500 deductible, you'd pay all of the repair costs. Also if you total your car, your insurer will give you a payment for its current value, minus your deductible.
Comprehensive and collision are the two most common coverages that include deductibles. You may also see a deductible for personal injury protection or uninsured/underinsured motorist property damage in some states. Deductibles work exactly the same for all coverages.
When you have to pay your deductible
Your deductible only applies to damages to your car rather than to someone else's. The general rule is if your insurance company pays for your repairs, then you pay your deductible. When they pay, you pay.
When you don't have to pay your deductible
There are a couple common outliers:
Another driver hits you
If the other driver is officially deemed at fault, their insurance company should pay for your repairs, and you won't have to pay your deductible. There are some situations in which both drivers are at fault. In those cases, you may end up paying a portion of your deductible.
You choose not to repair your car
At Progressive, the decision is yours. If you choose not to repair your car in a claim, we'll then write you a check for how much the repairs would have cost (minus your deductible). For example: You have $1,000 in damages and a $500 deductible. If you don't get repairs, we'll give you a $500 payment.
If you're financing your car, your lender may require you to get repairs.
How your deductible impacts your price
A higher deductible means a lower rate (and vice versa). For example: Let's say that collision coverage costs $250 for a six-month policy with a $100 deductible. The chart shows how adjusting the deductible can change the price. Increasing the deductible from $500 to $1,000 is the biggest jump in savings. But, going from $1,000 to $2,000 is almost meaningless.
|$250||$182 (27% lower)|
|$500||$129 (29% lower)|
|$1,000||$89 (31% lower)|
|$2,000||$84 (6% lower)|
This is an example of how changing the collision deductible impacts the collision price for a specific risk profile in Ohio, based on Progressive pricing as of 03/31/2017. This example is for illustrative purposes and does not reflect all pricing factors or your actual price.
Get a car insurance quote online and we'll show you exactly how your deductible changes your price.
How to choose the right deductible
Deductible amounts can typically range anywhere from $100-$2,000. The most common deductible our drivers choose is $500.
Do you want to pay less for car insurance or repairs?
We'll supply the facts, but it's really all about what you want:
Higher deductible = Lower car insurance rate and higher out of pocket costs
Lower deductible = Higher car insurance rate and lower out of pocket costs
How much can you afford to pay out of pocket?
Your deductible should never be higher than that number. If you have an accident, your deductible is how much you'll likely have to pay.
How likely are you to have an accident or claim?
Betting against having an accident is always a gamble. Our data shows that 17% of our customers with comprehensive/collision have a claim in a given year that would require them to pay some or all of their deductible. FYI: Comprehensive and collision are the most common coverages that include deductibles. If you've had accidents in the past and you typically drive a lot on busier roads, you may be even more likely to have an accident.
We offer free repairs for glass claims
Glass claims are the most common. In most states, if we can repair (instead of replace) your glass, we'll repair it at no cost to you. In a few states, we even offer an option for a $0 deductible for glass repairs AND replacements. That's important because the average cost for glass replacement for our customers is about $420. If your deductible is more than the replacement amount, you'll have to pay 100% out of pocket.