Navigating Car Insurance Deductibles: What You Need to Know

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Understanding Car Insurance Deductibles

Car insurance deductibles are the out-of-pocket expenses you must pay before your insurance coverage kicks in to cover the rest of the claim. This article will help you understand how car insurance deductibles work, the different types, and how to choose the right deductible for your needs.

How Do Car Insurance Deductibles Work?

Car insurance deductibles function similarly to those in health and home insurance. For instance, if you have a $500 deductible and your car repair costs $4,000, you would pay $500, and your insurer would cover the remaining $3,500. Deductibles typically apply to collision and comprehensive coverage but not to liability insurance.

Types of Car Insurance Deductibles

There are several types of car insurance deductibles:

• Collision: Covers damage from accidents with other vehicles or objects.
• Comprehensive: Covers non-collision damage like theft or natural disasters.
• Uninsured/Underinsured Motorist: Covers costs if you’re hit by an uninsured or underinsured driver.
• Personal Injury Protection (PIP): Covers medical expenses and lost wages regardless of fault.

When Do You Need to Pay a Car Insurance Deductible?

You generally need to pay a deductible for claims involving damage to your own vehicle, such as through collision or comprehensive coverage. Deductibles are not required for liability claims for injuries or property damage you cause to others.

Should You Pick a High or Low Insurance Deductible?

Choosing between a high or low deductible depends on your financial situation and preferences. Higher deductibles can lower your premiums but may strain your finances if you need to file a claim. Conversely, lower deductibles increase your premiums but make it easier to handle out-of-pocket costs.

What if I Can’t Pay My Deductible?

If you can’t pay your deductible, consider these options:

• Use emergency savings.
• Wait before filing a claim until you can afford the deductible.
• Ask the repair shop about payment plans.
• Consider cashing out rental coverage if you can go without a vehicle during repairs.

Contact O1ne Mortgage for Your Mortgage Needs

At O1ne Mortgage, we are dedicated to providing you with the best mortgage services. If you have any questions or need assistance, please call us at 213-732-3074. Our team is here to help you with all your mortgage needs.

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