Choosing a deductible amount on your car insurance policy can have a major impact on your policy premium and how much you’re responsible for paying if you’re involved in an accident. Your car insurance deductible is the amount you’d pay out of pocket for a collision or comprehensive claim to repair your car, while your insurance company pays the rest. So how should you choose your deductible limit? Bankrate has the answers.

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  • Your deductible levels affect your premium, but the change generally isn’t significant.
  • Because comprehensive claims tend to be less expensive than collisions, most insurance agents recommend a lower comprehensive deductible and a higher collision deductible.
  • You want to consider your financial situation and your car’s value when choosing deductibles.

What is an auto insurance deductible?

An auto insurance deductible is the amount you pay out of pocket for a covered loss when you have a full coverage car insurance policy and make a claim with your car insurance company for damages to your vehicle that are not covered by another driver’s policy.

The two types of auto insurance coverage with deductibles are collision and comprehensive. There are generally a wide range of deductibles to choose from, and the amounts typically range from about $250 to $1,000 or more depending on the insurance company and other factors. A higher deductible means that you will have to pay more out of pocket for a covered loss, but usually means you will pay less for your premium.

How do auto insurance deductibles work?

Full coverage includes comprehensive and collision, which cover damage to your vehicle. Collision coverage pays for damages caused by colliding with another vehicle, an object or a person. Comprehensive coverage pays for other forms of damage, like theft, vandalism, weather-related damage, fire and hitting an animal. Unlike liability coverage, both collision and comprehensive coverage have deductibles, which is the amount of a claim you agree to pay out of pocket. While you can choose the same deductible for both, they are independent of each other. For example, you could have a $100 comprehensive deductible and a $500 collision deductible.

Imagine your car is parked outside when a hailstorm hits. Your car sustains $1,000 in damage and you have a $100 comprehensive deductible. Your auto insurance company will pay $900 of the claim and you will pay your $100 deductible. If you rear-end another vehicle, your liability coverage will pay for the other party’s damages and injuries, while your collision coverage will pay for the damages to your car. If you have a $2,500 repair bill and a $500 collision deductible, you’ll get a claim payout check of $2,000. Although commonly misinterpreted, your deductible is subtracted from your claim payout; you do not need to pay your deductible before your insurance company will issue a check.

Both collision and comprehensive coverage pay without regard to fault. You can use your full coverage to fix your vehicle whether you caused an accident or another party did.

When do I pay a car insurance deductible?

If you’re involved in a car accident, figuring out who is at fault is a crucial component of determining who is responsible for paying your deductible.

When you are determined to be at fault for an accident and have comprehensive and collision coverage, you will likely need to pay for your car insurance deductible as part of the process for getting your vehicle repaired or replaced. The deductible typically isn’t paid to the insurance company but is instead withheld from the reimbursement check you receive from the insurance company when your claim is settled.

If the other driver is deemed at fault for the accident, their insurance company is responsible for paying for the damages, and you won’t have to pay your deductible as part of the claims process. If you have collision coverage, however, you can choose to file with your own insurer, who can then seek reimbursement, including the amount for your deductible, from the other driver’s insurance company.

For example, if you are hit by a driver who is clearly at fault but the claim is not resolved in a timely manner, your insurer may step in to pay for the repairs or losses and then pursue full reimbursement through the other company’s carrier.

If you are filing a glass claim, you may not have to pay your deductible, as some insurance providers offer free repairs on glass. Additionally, some states do not require you to pay a deductible for glass repair. If you have comprehensive coverage, read your policy to see if you have to pay a deductible for glass repair.

How do car insurance deductibles impact premiums?

Bankrate’s study of average car insurance premiums and deductible levels in over 35,000 ZIP codes nationwide confirmed that, generally, the higher your deductible, the lower your premium. Because you are willing to pay more in the event of a claim, insurance companies charge you less, though what may be surprising is that the difference is not always significant. Keep in mind, too, that our study focused on drivers with clean driving records. If you have an accident or ticket surcharging on your policy, you may see bigger savings by increasing your deductibles. While your deductible level can be a tool to help you control your insurance premiums, it isn’t always the most effective way to save on your car insurance.

  • Higher deductible: Choosing a higher deductible might lead to a slightly cheaper car insurance premium. However, you should first consider if you can reasonably pay the deductible amount at any given time without sacrificing your finances. If this isn’t the case, it might make sense to choose a lower deductible while having a slightly higher premium.
  • Lower deductible: A lower deductible means that you won’t have to pay as much out of pocket if you’re involved in a collision or comprehensive claim. While this is true, a lower deductible may also tempt drivers to file more frequent claims, which can raise your rates over time if you have too many at-fault incidents.

Learn more: The cheapest car insurance companies

Average full coverage premium by deductible amount

Comprehensive/collision deductible ($ amount) Average annual full coverage premium Annual premium impact
100/500 $1,806 +$132
250/500 $1,725 +$51
500/500 $1,674 $0
500/1,000 $1,523 -$151
1,000/1,000 $1,459 -$215

*Premium impact is adjusting deductibles from $500 comprehensive and collision deductible amounts

Small changes to your deductible levels — like changing from a $250 comprehensive deductible to a $500 comprehensive deductible — only moderately change your premium. However, larger changes can have a bigger impact. If you have a $100 comprehensive deductible and a $500 collision deductible, increasing to $1,000 for both could save you nearly $350 per year, on average.

What to consider when choosing your deductibles

Picking appropriate deductible levels is an important step in purchasing full coverage. If you choose levels that are too high, you may not be able to afford your deductibles, which means you won’t be able to finalize the claims process. But a deductible that is too low might mean paying more premium than you want to.

Typically, insurance agents recommend that your comprehensive deductible be between $100 and $500. Comprehensive claims tend to be filed for less damage than collisions, so having a lower deductible is often logical. Collision deductibles can sometimes go as low as $100 or $250, but most agents recommend that you start at $500 and increase if you can afford to.

When you are choosing your deductible, you might want to consider:

  • The actual cash value of your vehicle: The value of your vehicle could help you decide on deductible levels. If your car is only worth $2,000, a $1,000 deductible would cover half the insurance payment. As your vehicle gets older, you may want to consider adjusting your deductibles down to account for the lower value.
  • Your monthly or yearly budget: Because your deductibles affect your premium, your budget may play a role in determining the amounts you choose. For example, if you do not have money on reserve, a lower deductible could make sense. That way, you will pay a little more each month or annually instead of having a higher deductible if you file a claim. If you have enough savings to be comfortable paying more out of pocket during a claim, you could opt for a higher deductible to save on your premiums.
  • Deductible add-ons: There are optional deductible programs that you might be able to take advantage of. A vanishing deductible is a common option offered by auto insurers. This program will typically lower your deductibles by a set amount for each year that you don’t have a claim, although specifics vary by company. You may also have the option to choose “full glass,” which means that, regardless of your comprehensive deductible, you’ll pay nothing if the only damage to your car is to the glass. This can be helpful if you drive often and risk cracked or broken windshields and windows from roadway debris.

It may seem tricky to choose an appropriate deductible level. However, a bit of reflection into your financial situation, researching your car’s value and requesting quotes with various deductible choices could help you make a decision you feel comfortable with. Talking with a licensed agent can also be helpful. An agent can review your circumstances and help you choose deductible levels that suit your needs.


Bankrate utilizes Quadrant Information Services to analyze 2021 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on a 40-year-old male and female driver with a clean driving record, good credit and the following full coverage limits:

  • $100,000 bodily injury liability per person
  • $300,000 bodily injury liability per accident
  • $50,000 property damage liability per accident
  • $100,000 uninsured motorist bodily injury per person
  • $300,000 uninsured motorist bodily injury per accident

Collision deductible: Rates were calculated by evaluating our base profile with the following deductible amounts applied: 500 and 1,000.

Comprehensive deductible: Rates were calculated by evaluating our base profile with the following deductible amounts applied: 100, 250, 500 and 1,000.

To determine minimum coverage limits, Bankrate used minimum coverage that meets each state’s requirements. Our base profile drivers own a 2019 Toyota Camry, commute five days a week and drive 12,000 miles annually.

These are sample rates and should only be used for comparative purposes.