Insurance can get very confusing. For starters, is the insurance available to you from the get-go?
In this article, we talk specifically about deductibles in car insurance. What are deductibles, when are you liable to pay them and how to avoid them?
Table of Contents
- 1 What Is A Deductible?
- 2 When Do You Pay The Deductible For Car Insurance?
- 3 Do I Pay A Deductible If My Car Is Not Damaged?
- 4 Do You Pay A Deductible If You Hit Another Car?
- 5 What Happens If You Can’t Pay Your Car Insurance Deductible?
- 6 How To Avoid Paying Car Insurance Deductible?
- 7 How To Get Deductible Waived
What Is A Deductible?
A deductible is an amount that you pay before the insurance claim kicks in. If you have a claim, you pay the deductible before your insurance kicks in. For instance, say your damages after an accident equal $3000. Your deductible is $500. So the insurance company will pay you the total damages minus the deductible ($3000 – $500 = $2500) for your claims. Deductibles fall under out-of-pocket insurance costs and are a way of ensuring that claims are rightful and morally correct.
Lets put it this way. If an individual gets insurance, they may become reckless thinking that they are covered by insurance. The deductible ensures that the person takes moral responsibility for their property and guards it consciously from any damages. If your damage is less than the deductible, your auto insurer will not pay for anything as the costs will be covered by the deductible.
When Do You Pay The Deductible For Car Insurance?
To pay or not to pay, that is the question. The deductible for car insurance might be a necessary payment to make in one scenario, while it may not be your legal duty to pay it in other cases. When do you pay the deductible for car insurance?
Scenario 1: You got into an accident and it was your fault. If you end up damaging your car, you will need to pay the deductible before the insurance company takes over. However, if it was your fault in an accident and the other person’s car gets damaged, you are not required to pay the deductible. This is because liability claims do not have a deductible.
Scenario 2: You got into an accident and it wasn’t your fault. In this case, where both the cars are insured, insurance companies look at who is at fault before they ask for a deductible. If the other car is at fault, you don’t have to pay any amount. However, it usually takes insurance companies a long time to figure out who’s at fault. You may need your car repaired sooner than that and can file for a claim after paying your deductible. Once it is worked out that you were not to blame, you may ask for a reimbursement.
Scenario 3: You do not have full glass protection under your insurance policy. Full glass protection applies only to windshields. Some insurers have this covered in their policy, but if you don’t, you will have to pay the deductible in the case your windshield is damaged.
Do I Pay A Deductible If My Car Is Not Damaged?
Deductibles are payable when filing for an insurance claim. The insurance claim is only filed when your car suffers any damage. Hence, it is not necessary to pay a deductible if the car is not damaged.
Do You Pay A Deductible If You Hit Another Car?
Hitting another car can be as a result of two things – either it was your fault or it was the other person’s fault. In both cases, you do not have to pay for damages to the other person’s car. Liability claims do not entail deductibles. Your insurance will pay for the other person’s damages. However, for getting repairs to your own vehicle after your accident, you will have to pay the deductible, given that the accident was caused by you.
Similarly, if it was not your fault, you can file for claims from the other driver’s insurance company. You’ll need an official statement or proof that the accident was the other person’s fault.
What Happens If You Can’t Pay Your Car Insurance Deductible?
The first thing to make sure is to settle upon a deductible amount that makes it easily possible for you to afford it. If you are unable to do that before you get into an accident and need to file for claims, you will be denied claims. If you are unable to pay your car insurance deductible, there is a chance that your insurance company will not pay for your claims until you pay the deductible. The repairs to your car might be delayed.
Some companies allow you to not pay the deductible upfront. In this case, they may write you a check of the total damages minus the deductible and you can use that for the repairs, to begin with. You will still have to pay the deductible at some point to get the car repaired completely and handed over to you. In case you cannot pay the deductible, the mechanic can keep your car until you pay him.
How To Avoid Paying Car Insurance Deductible?
There is almost no way to avoid paying car insurance deductible. However, there are ways to pay it in a manner that suits you.
For instance, if you want to avoid paying car insurance deductibles you may choose to not do so if the damage is only cosmetic. If the car is still usable and does not possess a risk to you or anybody else on the road, you can keep on driving it like that until you have enough money to pay the deductible for claims and get it fixed.
Sometimes, not getting repairs is not an option. If you need the repairs done urgently, you should first check your policy. Your insurer may not provide deductible payment upfront. This means that they will write you a check that covers your damages after taking out the deductible from it. So for example, if your damages are at $3000 and your deductible is $500, the company might give you a check of $2500 for repairs.
Another option that you can look into is striking a deal with the mechanic. If you have known the mechanic for a long time or think it might be worth a try, you can ask him or her to fix your car with the deductible paid in instalments. This way, the mechanic pays for your deductible, you get the claims from the company and after your car is fixed, you pay back the mechanic in instalments, maybe with some interest. In some cases, if your bill is too large compared to the deductible, the mechanic may be willing to waive it off. This is a highly unlikely scenario but the only one in which you may be able to avoid paying the deductible completely.
Another way to avoid paying the deductible altogether is if you get a loan. You should be prepared to not receive any insurance claims in this case. You’ll pay the loan back in monthly instalments with interest.
Hence, you may not avoid paying the deductible altogether unless the mechanic decides to forego it. You may also delay it until later, pay it in instalments or pay when you have the money. There is no way the insurance company will process your claims without the deductible.
How To Get Deductible Waived
You can get the deductible waived only through the service mechanic. There is little the insurance company can do to help you out here. You can talk to the mechanic and ask him or her if they will be willing to sign off the deductible. Some mechanics may agree to do so if the remaining cost of the damages is large enough as compared to the deductible. Keep in mind that this is a legal practice and it never hurts to ask.
In short, what happens if you can’t pay your car insurance deductible is usually a rejection of claims from your insurance provider. Make sure to choose a deductible that makes it easier for you to pay it in unforeseen situations.