deductible, first consider how likely it is that you will file an insurance claim, what you can afford to spend on short notice, and how much it might cost to repair or replace your car. Also, consider the impact on your car insurance costs—the lower your deductible, the higher your premium will be.

Deductibles explained

A deductible is the amount of money you will have to pay before your car insurance company will cover a claim.

Car insurance deductibles

are similar to health insurance deductibles—you’re responsible for paying your deductible amount, and your insurance company will give you a payout for the remaining damage up to your coverage limits.

For instance, if you file an insurance claim for $2,000 and you have a $500 deductible, you’ll have to pay $500 before your insurance provider pays the remaining $1,500 of your claim.

Car insurance deductibles apply per occurrence, which means you’ll have to pay the full deductible amount each time you file a claim.

Every insurance provider has its own set of available deductibles. They can range anywhere from $50 to $10,000, but the most common deductibles are $500 or $1,000.

Infographic showing an example of a car insurance deductible. If you file a claim for $2,000 and you have a deductible of $500, your car insurance company will cover $1,500.

Three factors to consider when choosing a deductible

Before deciding on your deductible, you’ll want to consider three factors: the chance of you needing to file a claim, the amount of money you have in savings, and your car’s value.

1. Your risk of filing a claim

When you’re choosing a deductible, consider how likely you are to

file a claim

. If you’re at a higher risk of filing a claim, it makes sense to choose a low deductible, since you’re more likely to have to pay it.

If you have a history of speeding tickets or you’ve been in any

at-fault car accidents

, you’re statistically more likely to file an insurance claim in the future. You may also be at higher risk of filing a claim if you live in an area with high auto theft rates or where you’re more likely to experience natural disasters like flooding or wildfires.

On the other hand, if you have a

clean driving record

and you live in a low-crime area with a mild climate, you’re statistically less likely to file a claim in the future. In this case, it might make more sense to choose a high deductible—as long as it’s one you could still afford in the event you do have to file a claim.

2. The amount of money you have in savings

If you have a solid emergency fund tucked away that can cover unexpected repair costs or medical bills, choosing a higher deductible with a lower monthly premium might be the best option for you. Just keep in mind that you should at least have enough in your emergency fund to cover your deductible if you need to file a claim for vehicle repairs.

3. The value of your car

If you drive a newer or higher-value car, consider raising your deductible.

Expensive cars are more expensive to insure, but you may be able to help lower your premium by choosing a higher deductible. Additionally, the cost to repair or replace your car will be high, so if you do need to file a claim, your insurance company will still pay the majority of your damages, even after you pay your deductible.

If you have an older or less valuable car, you’ll usually pay less for car insurance, and your car repair costs will likely be relatively low. In this case, it may be beneficial to go with a low deductible to avoid paying all of your car repair costs out of pocket before you meet your deductible.

Learn more:

How to determine the retail value of your used car

Types of car insurance that require a deductible—and ones that don’t

Not all insurance requires a deductible, and you might need to choose different deductibles for different coverage types.

Types of coverage that require a deductible

Coverage that pays for physical damage to your vehicle almost always requires you to pay a deductible. This includes collision and comprehensive insurance:

Collision insurance

: Collision coverage pays out if your car is damaged in a collision with a vehicle or object. Collision premiums tend to be more expensive because they usually deal with more costly car repairs. With this in mind, it may be worth going with a higher collision deductible (and a lower premium) for collision coverage to help save you more in the end.

Comprehensive insurance

: Comprehensive coverage pays out if your car is damaged in incidents like a natural disaster, theft, or vandalism. Common comprehensive claims tend to be cheaper, so you may want to choose a lower comprehensive deductible. Otherwise, you may end up paying out-of-pocket costs for repairs.

To help you understand how deductibles impact car insurance premiums, our experts at Jerry reviewed the average cost of car insurance based on the most common deductible amounts—$500, $1,000, and $2,500. Here’s what they found across several top providers:

Here’s what you can expect to pay for a full-coverage policy based on your deductible amount, according to our experts:

Insurance company	$500 deductible	$1,000 deductible	$2,500 deductible
AAA	$270	$264	$255
Allstate	$241	$228	$224
Nationwide	$185	$181	$179
Progressive	$193	$184	$179
State Auto	$224	$218	$213

When you purchase insurance, you may be given the option to choose separate collision and comprehensive insurance deductibles. If you file a claim that includes both collision and comprehensive damages, you’ll only be required to pay the higher of the two deductibles.

Types of coverage that may require a deductible

For some types of coverage, your state laws will determine whether you have to pay a deductible:

Uninsured/underinsured motorist coverage (UM/UIM)

: Uninsured motorist coverage helps pay for your damages if you’re in an accident with a driver who doesn’t have insurance or whose insurance isn’t enough to cover your claim. Uninsured motorist bodily injury (UMBI) coverage usually doesn’t require a deductible, but some states require a deductible for uninsured motorist property damage (UMPD) coverage.

Personal injury protection (PIP)

is an optional insurance coverage in some states that helps pay for medical expenses for you and your passengers in the event of an accident. Whether you’re required to have a deductible is state-specific. Some insurance companies may also provide non-deductible PIP plans for a higher premium.

States that require PIP deductibles:	States that don’t specify PIP deductibles:
Delaware Florida Hawaii Kentucky Massachusetts New Jersey New York Oregon Utah	Arkansas District of Columbia Kansas Maryland Michigan Minnesota South Dakota Texas Virginia

Types of coverage that don’t require a deductible

Liability insurance

claims do not require you to pay a deductible. This includes:

If another driver causes an accident and you file a claim against their insurance for injuries or property damage.

If you cause an accident and another driver files a claim against your liability coverage.

Additionally, there are typically no deductibles with optional insurance add-ons, such as

Medical payments (MedPay)

rental reimbursement

Consider a vanishing deductible

If you have a history of safe driving habits, a

vanishing deductible

—also known as a “diminishing” or “disappearing” deductible—may be a good option. If you have a vanishing deductible, your insurer will decrease your deductible each time your policy renews, as long as you don’t file a claim.

Eventually, you could even end up with a $0 deductible, although some insurance providers may limit how low your deductible can go. Adding a vanishing deductible could raise your insurance premium as well.

Compare quotes

The last step in choosing your car insurance deductible is to make sure you get the best deal on both your car insurance deductible and premium. You can do this by comparing quotes from multiple car insurance companies.

With

Jerry

, you can compare car insurance quotes from dozens of providers using your profile, including your driving record and vehicle information. You can adjust your deductible and car insurance coverage levels directly in the app—and you can even look at separate quotes for your collision and comprehensive deductibles!

Simply download the Jerry app, enter your information, and you can review auto policies from the

best car insurance companies

Are you overpaying for your car insurance?

Compare quotes and find out in 45 seconds.

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FAQ

Is it better to have a $500 or $1,000 deductible?

It depends on many factors, such as your personal finances, the value of your car, and your driving risk. If you’ve practiced safe driving habits, a $1,000 deductible may be the best option for you.

Remember: deductibles aren’t met yearly. That means that they apply after every insurance claim and start over afterward. So if paying a $1,000 deductible is beyond your means, play it safe and choose a $500 deductible instead.

What is a good deductible for auto insurance?

A “good” deductible depends on what works best for you! The most common auto insurance deductibles for comprehensive or collision coverage are usually $500 or $1,000. Take your personal finances into consideration to determine what deductible works for you.

What should I set my car insurance deductible at?

In general, the best deductible for you is one that you can afford to pay on short notice in the event of a claim. However, you should also consider that choosing a lower deductible will cause your insurance rates to go up, so you’ll need to find the balance between an affordable deductible and an affordable premium.

Meet our experts

Hillary Kobayashi

Hillary Kobayashi is an insurance writer and editor specializing in insurance and finance topics. Hillary’s mission is to use her knowledge and love of education to help car owners better understand how they can save time and money on car ownership. The articles Hillary has published for Jerry span topics from state-specific bill of sale requirements to SR-22 insurance information.

Prior to joining Jerry, Hillary spent over ten years in education at Pacific University and the University of Oregon.

Amy Bobinger

Licensed Insurance Agent — Expert Insurance Editor

Expert insurance writer and editor Amy Bobinger specializes in car repair, car maintenance, and car insurance. Amy is passionate about creating content that helps consumers navigate challenges related to car ownership and achieve financial success in areas relating to cars.

Amy has over 10 years of writing and editing experience. After several years as a freelance writer, Amy spent four years as an editing fellow at WikiHow, where she co-authored over 600 articles on topics including car maintenance and home ownership. Since joining Jerry’s editorial team in 2022, Amy has edited over 2,500 articles on car insurance, state driving laws, and car repair and maintenance.