Exploring the Different Types of Car Insurance Deductibles

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Types of Car Insurance Deductibles

Have you ever wondered what those deductibles on your car insurance policy mean? Many get confused between terms like collision deductibles and comprehensive deductibles. Understanding what each deductible covers and how much you are responsible for is essential to having the right protection for your needs.

In this article, we will clarify this confusion by discussing the most common types of auto insurance deductibles so it all makes more sense.

What are Car Insurance Deductibles?

A car insurance deductible is an amount the policyholder agrees to pay out of pocket for repairs or losses resulting from an accident or any other incident covered under the terms of the car insurance policy, such as vandalism, before the insurance company pays any costs.

You can choose between a higher deductible that lowers their premium but increases their costs on claims or a lower deductible that works vice-versa. Regardless of coverage type, the driver must pay the amount before the insurance company will pay any remaining costs above that deductible. Policyholders pay when they submit a claim under certain standard types of auto coverage. Everyday situations that would necessitate paying the deductible involve filing claims under:

1. Collision and Comprehensive Coverage

The collision deductible applies to vehicle damage from accidents with other motor vehicles, objects, or incidents considered the driver’s fault. On the other hand, comprehensive insurance protects vehicle damage not caused by a collision, such as falling objects, natural disasters, fires, explosions, or vandalism.

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2. Personal Injury Protection (PIP)

Personal Injury Protection or PIP insurance covers treatment costs and lost income for the driver, passengers, or pedestrians involved in an accident, regardless of fault. With PIP, insurers compensate for all injuries resulting from a crash without determining liability for the accident.

In addition to a standard deductible amount, the policyholder may be responsible for paying a portion of medical bills through cost-sharing even after satisfying the deductible.  By separating injury claims payments from liability decisions, PIP ensures swift reimbursement for crash injuries to help with treatment costs.

3. Uninsured Motorist Coverage

The Uninsured Motorist Coverage deductible applies to an accident caused by another motorist who lacks automobile insurance or has insufficient policy limits. It compensates for bodily injuries to yourself and any passengers sustained in a collision up to the limits selected in your policy.

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Situations with No Deductible

There are some scenarios in which you would not be responsible for the deductible amount on your auto insurance policy. If another driver is at fault for an accident, their liability coverage will pay for your vehicle damages up to the specified limits without a deductible from you. Similarly, your liability insurance would cover the other parties’ damages if they find you at fault.

Some states also allow claims under uninsured/underinsured motorist coverage for bodily injury without a deductible. Specific policies allow glass repairs or replacements to be covered with no deductible required. Additionally, some insurers offer policies that provide deductible waivers or have a diminishing deductible structure so that in certain situations, your out-of-pocket costs would be $0 following an incident.

This includes behavior that incentivizes safe driving. With this approach, the standard deductible amount gradually decreases if the policyholder maintains a clean driving record without at-fault accidents or traffic violations for a designated period.


Various deductibles play different but essential roles in your overall car insurance coverage. Understanding your options for each type can help you select the right deductible amounts that provide necessary protection without costing more than your budget allows. With the various options explained here, you should feel more informed to talk with your agent about tailoring a deductible structure that perfectly fits your insurance needs.

Dylan Miller

I am a Chicago native and regular contributor to "Locar Deals". I have a master's degree in English, am an automobile content creation specialist, and have written professionally for a variety of automotive companies over the past few years. I write on a variety of vehicles, from high-end luxury cars to ten-year-old gas guzzlers and everything in between. And I love sharing valuable car buying tips with consumers from all walks of life.

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