Car Insurance Deductibles Explained with Real Examples

Published April 22, 2026 • 6 min read

Disclosure: Policy terms and claim handling vary by insurer.

Your deductible is the amount you pay before insurance contributes to a covered loss. Higher deductibles often lower premiums but increase out-of-pocket cost when claims happen.

Quick Example

• Repair bill: $2,400
• Deductible: $500
• Potential insurer payment: $1,900 before limits and exclusions

How to Pick a Deductible

1. Choose an amount you can pay without borrowing.
2. Compare annual premium savings between deductible options.
3. Avoid high deductibles if emergency savings are limited.