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Auto Insurance Deductibles Explained

Written and reviewed for insurance accuracy by Richard Sweet. Published June 25, 2026. How we review this

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Deductibles are where a quote can look cheaper while quietly shifting risk onto you.

What a deductible is

A deductible is the amount you pay before your coverage pays the rest. On a covered claim with a 500 dollar deductible and 4,000 dollars of damage, you pay 500 and the policy pays 3,500. The higher your deductible, the lower your premium, because you are keeping more of the small and mid-sized losses yourself.

The deductibles to look for

  • Collision deductible. Applies to impact damage to your vehicle.
  • Comprehensive deductible. Applies to theft, hail, fire, animal strikes, and other non-collision losses. Often lower than collision.
  • Glass deductible. Some policies treat glass separately, occasionally with no deductible.
  • PIP or UM property damage deductible. Depending on the state and policy, these may carry their own deductibles.

Higher deductible vs lower premium

Raising a deductible from 500 to 1,000 dollars lowers the premium, but doubles what you pay on the next claim. The math only works if you keep the difference available. A good rule is to set the deductible at the most you could comfortably pay tomorrow if your car were damaged today.

Compare them in dollars

When you compare quotes, line up the deductibles vehicle by vehicle. A cheaper quote that raised your collision deductible from 500 to 1,500 dollars is not 200 dollars cheaper; it is 200 dollars cheaper in exchange for 1,000 dollars more risk on every collision claim. Compare the real numbers, then decide.

Questions to ask your advisor

  • What deductibles am I currently carrying on each coverage and each vehicle?
  • How much premium do I actually save by raising a deductible, and is the trade worth it?
  • Could I comfortably pay the higher deductible if a claim happened tomorrow?
  • Does this quote or policy handle glass with its own deductible or none?
  • Did a cheaper quote raise any deductibles compared to my current policy?

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Continue the series

You are reading part 7 of How to Compare Auto Insurance Quotes Without Getting Burned.

Previous: Comprehensive vs Collision Coverage

Next: Actual Cash Value and Total Loss Claims

What many people don't realize

The part that catches owners off guard

  • A deductible is what you pay out of pocket before the coverage pays the rest.
  • Comprehensive and collision usually carry separate deductibles.
  • Glass and PIP or UM property damage may have their own deductibles too.
  • A higher deductible lowers the premium but increases what you pay at claim time.
The Vantage Point

What we see most often

A deductible is the simplest lever in your policy and the easiest one for a cheaper quote to pull. Raise the deductible, drop the premium, and the quote looks better, right up until you have a claim and discover how much of it is yours. The savings are real, but so is the retained risk, and the trade only works if you can actually cover the deductible when something happens.

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When to review

It may be time for a coverage review if:

  • You are comparing two quotes with different deductibles
  • A new quote is cheaper and you have not checked the deductibles
  • You want to know your real out-of-pocket cost before a claim
  • You carry separate vehicles and have not reviewed the deductible on each
  • You replace windshields often and want to know how glass is handled
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Frequently asked

Frequently asked

How do comprehensive and collision deductibles differ?
They apply to different losses and can be set at different amounts. Comprehensive (theft, hail, animal strikes) often carries a lower deductible than collision (impact damage), but you choose each one, and they can vary by vehicle.
Is a higher deductible a good way to save money?
It lowers the premium, but you pay more at claim time. It makes sense if you can comfortably cover the higher deductible out of pocket. If a 1,000 dollar deductible would be a hardship, the premium savings may not be worth it.
Does glass coverage have a separate deductible?
Sometimes. Some policies and states offer full glass coverage with no deductible or a separate glass deductible, which matters if you frequently replace windshields. Check how each quote handles it.
Can each vehicle on my policy have a different deductible?
Often yes. On a multi-car policy you can set different deductibles by vehicle, for example a higher collision deductible on an older car and a lower one on a newer one. Line them up vehicle by vehicle when comparing.
What deductible should I choose?
A common approach is to set the deductible at the most you could comfortably pay tomorrow if your car were damaged today. There is no single right answer, which is why it helps to weigh the premium savings against the retained risk.
RS
Written and reviewed by

Richard Sweet

Founder and Principal Advisor, Vantage Point Risk

Richard Sweet runs Vantage Point Risk, an independent insurance and risk advisory for property owners, real estate investors, business owners, and families. He works with investors every week on the coverage decisions that decide how a claim actually turns out, and writes the Learning Center to put those decisions in plain language.

Written and reviewed for insurance accuracy by Richard Sweet. Published June 25, 2026. See our editorial process. Spot an error? Email support@vantagepointrisk.com.

Richard also writes The Vantage Point, notes on building a better business.

Coverage varies by insurance company, policy form, state, endorsements, limits, deductibles, and exclusions. This is general educational information, not a guarantee of coverage or insurance advice. Actual coverage depends on the specific policy language.

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Related resources

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Comprehensive vs Collision Coverage

Comprehensive and collision both protect your own vehicle, but in different ways and with separate deductibles. Here is what each covers, when a lender requires them, and when dropping them on an older car may or may not make sense.

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Actual Cash Value and Total Loss Claims

When a car is totaled, most policies pay its actual cash value, not what you paid or what you owe. Here is how vehicle value is determined, what happens when the loan exceeds the value, and when agreed value or stated amount coverage matters.

Related

How to Compare Auto Insurance Quotes Without Getting Burned

A lower auto insurance quote is not always a better one. Use this method to compare a new quote against your current policy, coverage by coverage, so you understand what changed before you switch, not just what you saved.
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Answer a few quick questions and get a clear read in about two minutes. We will flag what is worth a closer look, and you can hand us your current policy if you want us to dig in. No pressure, no obligation.

We review your current coverage for gaps and overlaps
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We tell you what is actually worth changing, and what is not
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