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What is a car insurance deductible?

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A car insurance deductible is the amount you are responsible for paying out of pocket when filing a claim with your insurance company for a covered loss. Your chosen deductible will impact your premium, and choosing one you can afford may be important for avoiding financial stress in the event of an at-fault incident. Read on to learn more about how deductibles work, when they apply, and how to choose a deductible for your car insurance policy.

How do car insurance deductibles work?

A car insurance deductible is the amount you agree to pay out of pocket for the repairs to or replacement of your vehicle after a covered accident. Keep in mind that a deductible does not apply for minimum coverage policies, as these policies don’t cover damage to your car. If you have full coverage with either comprehensive or collision coverage, or both, a deductible would apply. For example, if you are involved in an accident causing $5,000 of damage to your vehicle, and you have a $500 collision deductible, the insurance company would pay $4,500 of the claim while you are responsible for $500.

Choosing a higher deductible typically lowers your premium, because it means the insurance company won’t have to pay as much if you file a claim. But remember that a higher deductible means you will have to pay more in the event of a claim where the deductible applies. You determine your auto insurance deductible amount with your insurance agent or carrier before finalizing your auto insurance policy. However, you should have the option to change your deductible at any time.

What types of car insurance deductibles are there?

Your auto insurance policy is a package of different coverage types. Some coverage types, like liability, may pay the other party for injuries and damages if you cause an accident. Other coverage types — such as comprehensive, collision, personal injury protection and uninsured motorist property damage — exist to help cover injuries to those in your vehicle and damage to your car. These coverage types may have deductibles, or at least the option to include a deductible to reduce the cost of coverage.

Here are a few coverage types that usually have a deductible or the option to choose one:


Comprehensive coverage provides financial protection against damage to your vehicle caused by an incident other than a collision. This includes theft, fire, flood, vandalism, hail, falling rocks or trees and other hazards, such as hitting an animal. A comprehensive deductible is the amount you agree to pay to repair or replace your vehicle if you file a claim under your comprehensive coverage. If the repair costs are less than your comprehensive deductible, you would pay for the repairs yourself.

While there are many instances in which a deductible may apply, there are some scenarios where your comprehensive deductible does not apply. For example, you may have the option to purchase a “full glass” option on your comprehensive coverage. This means that if you have a chip or crack in your windshield, or any other glass-only damage to your vehicle, you won’t have to pay your comprehensive deductible at all. Some insurers offer zero-deductible comprehensive coverage, which means you would not pay anything if you filed a claim for any comprehensive damage, but your premium would be higher.


Collision coverage pays for damage to your vehicle resulting from an at-fault collision with an object, building or vehicle. Collision coverage will not reimburse you for mechanical failure or normal wear-and-tear on your car. If you file a claim for damage to your vehicle under collision coverage, the collision deductible on your policy will apply.

Collision deductible options typically range from $0 to $2,500 and may even go higher. Collision coverage does cost money, so it’ll likely result in a higher premium, but you can control some of that premium with your deductible level. Just like with comprehensive, a higher deductible generally means a lower premium. Because collision claims tend to be more expensive than comprehensive claims, your collision deductible generally has a larger impact on your premium. If you choose not to add collision coverage to your policy, you may avoid a higher premium, but you will be responsible for paying for damage to your vehicle in a collision where you are at fault.

Uninsured and underinsured motorist property damage

Uninsured or underinsured motorist property damage coverage provides coverage if your vehicle is damaged by an uninsured or underinsured driver. Uninsured and underinsured motorist coverage is optional in most states but required in others. You may have the option to choose a deductible if your state offers an uninsured and underinsured motorist property damage option. The bodily injury liability portion of these coverage types — which pays for your injuries and your passengers’ injuries if you’re hit by an uninsured or underinsured driver — generally does not have a deductible.

Personal injury protection

Depending on your state, you may be required to have personal injury protection (PIP) coverage on your policy, or it may be optional. In some states, it’s not offered at all. This coverage may help pay for medical expenses for you and the passengers in your vehicle. It may also help cover expenses related to lost wages or household responsibilities after an accident. You may have a deductible that applies if filing a claim under this coverage. Many states with PIP deductibles provide several options to choose from, and the deductible you choose can impact your premium.

What car insurance coverage types do not require a deductible?

Liability coverage is required in most states and helps cover injuries and property damage for the other party or parties if you are at fault in an accident. When you buy liability coverage, you will choose a specific amount of coverage. These coverage limits are the maximum amount the insurance company will pay the other party for a covered claim. As liability coverage is designed to cover the other party’s injuries and vehicle repairs, there is no deductible.

If you choose optional coverage types like roadside assistance or rental car reimbursement, there is generally no deductible, though there may be coverage limits and caps on the amount of claims you can file for these add-ons.

How do car insurance deductibles impact premiums?

Bankrate’s study of average car insurance premiums and deductible levels nationwide confirmed what our licensed agent team members already knew — generally, the higher your deductible, the lower your premium. With higher deductibles, you are willing to pay more in the event of a claim, so 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 deductibles: Choosing higher deductibles might lead to a slightly cheaper car insurance premium. However, you should first consider if you can reasonably pay the deductible amounts at any given time without sacrificing your finances. If this isn’t the case, it might make sense to choose lower deductibles while having a slightly higher premium.

  • Lower deductibles: Lower deductibles mean 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, lower deductibles 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

Below, we showcase the average cost of car insurance by various deductible levels. Our base profile rates include $500 comprehensive and $500 collision deductibles, which is why you see no annual premium impact for that level.

Comprehensive/collision deductible ($ amount)

Average annual full coverage premium

Annual premium impact*
















*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 over $500 per year, on average.

How should I choose my car insurance deductible?

With so many choices in deductible levels available, you may be wondering how to choose the right one. It may be helpful to consider the following as you shop for a car insurance policy.

Do you want to pay less for car insurance or repairs?

A higher deductible will generally lower your insurance premium, but you will pay higher out-of-pocket costs if you file a claim for damage to your vehicle. Some claims may even be below your deductible amount, and you might have to pay the entire amount out of pocket. For example, if you back into a tree and do $350 worth of damage to your vehicle and your collision deductible is $1,000, you will pay out of pocket for all the repairs.

If you opt for a lower deductible, your car insurance rate will likely be higher, but you would have lower out-of-pocket costs if you file a claim. If your deductible is $100 and you cause that $350 damage by backing into a tree, you would only have to pay your $100 deductible, while your insurance would pay the other $250. However, you could spend more on your premium by having a lower deductible and never end up filing a claim. This is the nature of having insurance coverage and an example of the risk both you and the insurer take on.

How much can you afford to pay out of pocket?

Before you choose a deductible, most insurance professionals recommend you figure out what you can afford to pay if your car is damaged in an accident. If your budget allows for a maximum out-of-pocket expense of $500, you probably should not choose a deductible higher than $500. If you do, you may not be able to afford to fix your vehicle if you need to pay the deductible for repairs.

Does your lender have deductible requirements?

If your vehicle is financed or leased, your lender will likely require you to carry comprehensive and collision coverage for your vehicle. If that is the case, you will need to choose deductibles for each. Some lenders will have a maximum deductible that you are allowed to carry for comprehensive and collision. It is important to check with the financial institution that handles your loan or lease to determine if these restrictions exist.

When are you not required to pay your car insurance deductible?

There will be occasions when you are not required to pay your deductible. In general, you will typically not be required to pay your deductible in the following scenarios.

Another driver is at fault

If another driver is deemed at-fault in an incident and they are insured, you should not be responsible for paying a deductible on the claim that you file through their insurance company. Your deductibles only apply when filing a claim with your insurer.

You have a diminishing deductible

Some insurance companies offer a diminishing deductible or vanishing deductible option that could decrease or eliminate your deductible. This policy feature may reduce your deductible over time if you remain accident- and violation-free. For instance, your company may reward you with $100 off your deductible for each accident-free year. So, for example, if you have a $500 collision deductible and you do not have an accident or violation for four years, if you needed to file a claim, your deductible would be $100 instead of the original $500. Once you use your diminishing deductible, there is usually a time period to qualify for it again. This feature is not available from every carrier.

You purchase a full-glass option

If you have a full-glass option on your comprehensive coverage and the damage to your vehicle is limited to glass, you won’t have a deductible to pay. Not all companies offer this option, and in some states, it may be automatic.

Frequently asked questions

    • There are a few different coverage types on your policy that could kick in if you are deemed at- fault for an accident where you hit another car. Your bodily injury liability and property damage liability would pay for the damages and injuries to the other party and their vehicle, and those coverage types do not have a deductible. However, if you have collision coverage and want the insurance company to step in to cover the repairs to your vehicle, you would have to pay your collision deductible.

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    • This depends on the circumstances. If the accident was the other driver’s fault, their liability coverage should pay for your damages, and you should not have to pay a deductible. However, if the other driver is uninsured or underinsured, you may be responsible for paying a deductible depending on how your coverage applies to cover the expenses. If you are hit by another driver whose insurance company denies the claim, or if you are involved in a complicated claim that is taking a long time to be settled, you could use your collision coverage to pay for your damages. Your insurance company would pay for your damages, minus your deductible, and then ask the at-fault driver’s insurer to pay the money back in a process called subrogation.

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    • Most insurance professionals recommend choosing a deductible you can comfortably afford to pay. If you want a lower premium, you could consider a higher deductible if you can afford it. However, if a $1,000 deductible is not feasible, it may make sense to take the lower deductible and pay a higher premium. When choosing a deductible, you might also consider the value of your car. For example, if your car is only worth $1,500, setting a $1,000 deductible means your insurance company may only be responsible for up to $500 in damages to the vehicle.

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    • If you file a covered claim under a coverage type with a deductible, you may have to pay the deductible prior to work beginning on your damaged vehicle or before you can pick up the car once repaired. Most car insurance companies require you to pay the deductible to the repair shop, while the insurer would pay the balance minus your deductible. This is why most insurance professionals recommend choosing a deductible you can comfortably afford to pay in the event of a claim.

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Bankrate utilizes Quadrant Information Services to analyze 2023 rates for ZIP codes and carriers in all 50 states and Washington, D.C. Rates are weighted based on the population density in each geographic region. 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

  • $500 collision deductible

  • $500 comprehensive deductible

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

Collision deductible: Rates were calculated by evaluating our base profile with the following deductible amounts applied: $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 2021 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.


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