What is a deductible?

Explanation Of deductibles

When you purchase auto insurance to cover your vehicle, you must choose a deductible amount for the policy. If your car is damaged or stolen and you file a claim, the only amount you have to pay is the deductible amount. The auto insurance company pays the rest of the claim up to your coverage limit.

If you want a low deductible to curb out of pocket expenses at the time of an accident, the lower the deductible, the higher your insurance premiums will be. It may be more cost effective to have a higher deductible but also have a higher coverage limit.

Ask your insurance provider to give you multiple quotes with various deductibles before deciding a deductible amount.

This FAQ is filed under: Auto Insurance

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