What is a Car Insurance Deductible?

A car insurance deductible is what you will pay out of pocket before your coverages kick in. Higher deductibles mean you spend less on your car insurance premium but more out-of-pocket if you file a claim with your auto insurance company. A lower deductible will increase your car insurance premium, but will reduce out-of-pocket expenses. It is essential to choose a deductible you can afford. Car insurance deductibles do not work like health insurance deductibles. You do not meet an annual deductible with your car insurance. In actuality, you pay your deductible every time you file a claim with your auto insurance company for the life of your policy. Is it best to have a high or low deductible? The Gordon Agency will review the pros and cons of both to help you decide.

Higher Deductibles 

Higher car insurance deductibles equal higher out-of-pocket expenses. If you cause damage to your  car and your deductible is $1,000, you will need to pay the $1,000 towards any damages before your insurance company pays. If the damages to a car cost $750, it wouldn’t make sense to file a claim. You would be responsible for paying for the repair bill.

A higher deductible also equals lower rates in your insurance premium. The higher the deductible, the lower the premium. If you are a careful driver and raising the deductible makes sense to you, set money aside in an account in case you ever need to file a claim and pay the high deductible you selected.

Lower Deductibles

Lower deductibles increase your car insurance premiums but also lead to more coverage. Take the same scenario as before, but change your deductible to $100. You cause damage to your car, and the damages are $750. Now, it may make sense to file a claim since you will only be required to pay the $100 deductible and your insurance company will pay the rest.

Facts about Deductibles

  • A deductible only applies to damages to your car. If your insurance company pays for the repairs, you are required to pay the deductible.
  • A deductible not required if another driver is at fault The driver’s insurance company will pay for the repairs, so your deductible does not need to be paid.
  • If both drivers are at fault, they will each pay the cost of the deductible.
  • If you file a claim and choose not to repair your car, your insurance will send you a check for the amount or repairs minus the deductible.
  • Leased cars may be required to be repaired by the lender.
  • Collision and comprehensive are the two most common coverages that carry deductibles.
  • In some states, personal injury protection and property damage may also carry a deductible.
  • Deductibles work the same for all coverages on all auto insurance policies. One deductible per claim for the life of the policy

Insurance Agent Boca Raton

The Gordon Agency

 This is the home of Florida’s Insurance Professionals. We are a multi-line independent agency that provides insurance solutions for both personal, and commercial lines. Combining decades of relationship building with motivated licensed insurance agents to provide coverage options for all of your insurance needs.  Our team of agents relies on our education, integrity, experience, and attention to detail to accurately assess each opportunity and to offer the optimal solutions for all of our clients. We are dedicated to matching the right product for every situation, always at the best price available. Call us at 561-988-3330, visit our website or paste our address in your browser..


The Gordon Agency Inc.
1825 NW Corporate Blvd Ste 110,
Boca Raton, FL 33431
(561) 988-3330


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