Your deductible is the portion of your auto insurance policy that you are responsible for in the event that you file a claim for damages.
The deductible can be waived under certain circumstances, the most common being if your damages are covered by the insurance of someone else.
The deductible is one of the factors in determining the cost of your insurance premium. The insurance premium is based upon the amount of insurance that you are carrying on your vehicle and the higher the deductible, the lower your car insurance premiums will be.
When you compare auto insurance quotes, ask the insurance company to give you quotes with different deductibles so you can see what your savings would be.
If you are involved in an accident that is your fault and you file a claim with your car insurance company, you will get quotes from auto bodyshops for the cost of repairs to put your vehicle back the way it was before the accident. Your car insurance company may require you to get more than one quote.
You will then decide where you want to take your vehicle for repairs and inform your car insurance company. They will send an adjustor out to look at the car and write their estimate of the damages and then the bodyshop will work with the insurance company to repair your vehicle.
When it is finished, you will pay your deductible at the time you pick the vehicle up. The car insurance company will have already settled with the bodyshop for the amount owed. If the car insurance company sends you a check, you will take that with you to give to the bodyshop for the repairs of the vehicle.
When you have a high deductible, such as $1,000 or $2,000, your car insurance company does not need to insure you for as much money and they will lower your premium.
The deductible is due for any accident and not a one-time payment or an annual payment. Should you find yourself in more than one accident in a year that is your fault, you will need to pay the deductible more than once. You will probably also see an increase in your car insurance rates and your next premium will be a little higher since you are a higher risk.
If you are doing an auto insurance quote comparison from a couple companies, make sure that you compare the same deductible from each company in order to receive true comparison quotes.
If you decide to lower your car insurance premium by carrying a higher deductible, make sure that you can come up with the money to cover your deductible. If you cannot cover the deductible, the bodyshop may not release the car to you until you pay that difference.