If you do not have deductible auto insurance, you have chosen coverage options where you do not have to pay an upfront amount for a covered claim. Suppose you have chosen collision insurance without excess. If you have a covered repair claim of $2,500, your insurer will reimburse you the full $2,500. If, on the other hand, you had collision insurance with a deductible of $500, your insurer would reimburse you $1,000 (repairs covered minus your deductible).
Please note that this amount applies whenever your car insurance has a deductible when you make a claim. This differs from a health insurance deductible, in which only one deductible is generally paid each calendar year.
Here are some things to consider if you want to purchase a zero-deductible policy.
THE COST OF A NON-REMOVABLE POLICY
You are likely to pay a higher premium for coverage without a deductible. Indeed, deductibles are used to share the risk of accident with an insurer, explains III. Buying a policy with no deductible carries only the risk with the insurance company. A higher premium for a policy with no deductible (or with a low deductible) is the way the insurance company accepts this higher risk.
THE DEDUCTIBLE IS DETERMINED IN A POLICY FOR EACH COVERAGE
A deductible is what you pay for direct repairs to your car before your insurance covers a claim. Some auto insurance covers have a separate deductible. Therefore, you can have multiple deductibles in one policy.
When you buy collision and full coverage, you can usually choose your deductibles (from the amounts set). Keep in mind that if you don’t have a deductible for coverage, you can increase the amount you pay for that coverage.
When it comes to liability insurance, most insurance companies do not need deductibles regardless of the coverage chosen.
SOME DEDUCTIONS DETERMINED BY STATE
The deductible options do not vary according to the state and the insurance offer. Some states have laws that require a deductible for certain types of coverage. In these states, an option with zero deductible is not allowed for certain types of coverage, e.g. B. for personal injury protection (PIP) or coverage of property damage by uninsured drivers. These covers are not available in all states.
On the flip side, some states have laws and coverage options that allow you to waive a deductible for certain types of claims. Take, for example, complete coverage that will help you repair or replace a broken windshield. In most states, insurers generally waive the full deductible on a glass claim if the glass is repaired and not replaced. In some states, full coverage may include “full glass coverage”. If you purchase the full glass option, the deductible will not apply if the damage to the glass is repaired or replaced.
You may be able to select certain deductibles without a deductible, do not automatically have a deductible for other coverages or are legally obliged to pay a deductible for other coverages. Talk to your local representative – he or she can help you make decisions that fit your needs and budget.