What exactly is a car insurance deductible? It’s what you pay “out of pocket” on a claim before your insurance company will pay their portion of the claim.
Comprehensive and collision are the two most common types of coverages. They work the same way and you get to choose the amount of the deductible. For example, if you carry a $500 deductible and incur $3,000 in damages from a covered accident, the insurance company would pay $2,500 toward repairing your car. You are responsible for coming up with the remaining $500, and this can be problematic at times.
The experts at Affordable Car Insurance Tampa, a leading provider of car insurance in Tampa FL, have compiled the details on insurance deductibles.
Car insurance deductibles are expensive
Deductibles are expensive… unless, that is, you managed to get a very low or zero deductible. But then your policy premiums will be higher to offset the disparity, so you can’t get around the fact that automobile insurance is expensive. So if you’re in an accident and need to get your car repaired, what happens if you can’t pay your deductible? Is there anything you can do?
The answer is: sometimes.
If you really can’t come up with the deductible amount, you could be in real trouble. Most insurance companies won’t pay for repairs following an accident until you’ve paid the deductible to the mechanic. Check to see what your insurance policy requires.
You have a few options:
You can ask to have the deductible waived. If you have a long-standing relationship with your mechanic, it may be possible that they might waive your deductible completely. It would be very unlikely, but if they are making enough money from the vehicle repair, they may be willing. It’s worth asking.
You can apply for a loan. This will be more expensive in the long term due to interest payments, but you will have a car to drive to work in the meantime. One option might be a short-term “payday loan”, where you get an advance on your paychecks before you’ve earned them, and then pay it back with interest.
A benefit is that they usually don’t require a credit check, but to better secure the risk to them, interest rates will be higher. A better type of loan might be a personal loan: you’ll still have to pay it back with interest, but you can typically get better terms.
Get creative. Sell some things you don’t need or use and for money to pay for the deductible.
Delay reporting the accident to your insurance company. As long as you are reporting the accident within the time frame stated in your policy, this might be a good option. As long as the damage isn’t too great, you could delay getting the repair work done until you can save up enough money to cover the deductible.
How can I avoid paying my deductible?
There aren’t many available options to avoid having to pay your deductible, but there are a few that you can try. For example, you can:
Avoid making a claim. This would mean you wouldn’t get any help with car repairs. You’ll be driving a damaged vehicle if it even runs, but you won’t have to worry about paying your deductible or your insurance premiums going up.
Pay it out of pocket. If you can afford to pay the entire amount of repairs yourself.
Make a deal with the mechanic. You can ask your mechanic to bill the insurance company, minus the deductible, and allow you to make payments to them instead. This is perfectly legal and worth seeing if your mechanic would be willing to work with you. However, if you then avoid repaying your deductible or even refuse to pay the mechanic back despite your agreement, he can legally keep your vehicle until you pay him in full.
Another option with your repair shop is to ask them to bill the insurance company minus the deductible, and then ask them to waive the deductible completely. The success rate isn’t very high with this one, but it may be worth asking for it if you’re really in a bind.
When you don’t have to pay your deductible
There are some legitimate circumstances under which you will not have to pay a deductible. For example, when:
An insured driver hits you. If the other driver is found to be at fault, their insurance company will be liable for repairs to your car, including the deductible. You have the option of having the other insurance company pay you or your repair shop for the entire amount. Or you may choose to go through your insurer and let them be reimbursed by the other company, your deductible included.
Another person files a claim against your liability coverage. If you caused the accident and the other person files a liability claim against you, your insurance company covers damages and injuries they received, up to the limits of your policy. You pay nothing out of pocket.
You elected for no deductible. You were willing to pay higher premiums and chose a $0 deductible on your insurance policy’s comprehensive coverage. $0 deductible means you don’t pay any deductible on a claim. Please note that not many car insurance companies offer this option, as they consider it too risky. If they do offer this option, they will have strict additional requirements, such as a perfect credit score and a perfect driving record.
You have free repairs on glass claims. Many companies offer free repair (versus replacement) on broken glass if the glass can be fixed. This would help with at least part of the overall repair costs.
There is no avoiding it. Other than the circumstances listed above, if you are in an accident and need repair work done, you are simply going to have to figure out how to pay your deductible. You do have a few options on how to accomplish that, but the reality is, if you don’t pay your deductible, you will have to deal with a broken-down car.