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“Do I pay a deductible if I hit a car?”, is a question that you may ask yourself someday.
In fact, this is something that you will need to decide before you purchase auto insurance.
There are several factors that should be taken to attention when determining the needed amount of deductible, including state law, coverage, your budget, etc.
Here you will find answers to the most common questions related to this topic.
What Is Deductible?
When it comes to auto insurance, the deductible is money that you will have to pay for repairs before your insurance company pays the rest.
For instance, if your deductible is $300 and due to an accident your car needs to be repaired for the total amount of $1,000, then you will pay $300, and your insurance company will cover the rest of $700.
If the amount needed for repairs is $300, then you will cover everything yourself, which means that your insurance company will pay nothing.
How Deductibles Depends on Coverage
A deductible also depends on specific coverage that you have according to your policy.
Usually, you can set the deductible for comprehensive or collision coverages.
When it comes to zero-deductible or liability coverages, you do not have to set a deductible.
More information you can find out from your agent.
It is recommended to compare conditions of different insurance companies to find out an optimal offer.
A zero-deductible option for certain coverages is not allowed in some states, for instance, for personal uninsured motorist property damage or injury protection coverages. Also, state law may require having a deductible on certain types of coverages.
How to Choose?
The amount of deductible that you will have to pay has to be estimated before you purchase your policy.
You may think that having a small deductible is more beneficial, but it may not be so because a higher deductible can reduce the costs of the insurance premium.
The highest premiums are paid for a no-deductible policy.
Anyway, you should choose the amount that you will be able to pay if an accident happens.
It is recommended to choose the maximum amount that will not cause much stress in your life.
Several factors should be taken to attention, such as your income, regular expenses, personal savings, available credits, etc.
It is recommended to contact an insurance agent and try to figure out all the important matters.
You should discuss the particular amount that you will have to pay for your premium and deductible. Another thing that you should consider is whether you are a good driver.
If you have been driven for several years without accidents, you may consider setting up high deductible to reduce your premium payments.
So, if you are still asking yourself, “Do I pay a deductible if I hit a car,” you should know that in most case it depends on conditions you choose within your insurance policy and what is allowed in your state.