Why does it seem that sometimes you have to pay your deductible on a car insurance claim, and sometimes you don't?  What is the rational to this seemingly inconsistent process? 

At HPM Insurance we represent many insurance companies so can provide some insight into the general guidelines that most insurance companies follow regarding deductibles. So...

When do I pay my car insurance deductible?

What is a Deductible?

A deductible is the amount of money that is paid by the insured before the insurance company pays its portion of a covered claim.  On both a personal auto policy and a business auto policy, a deductible can apply to both the collision and comprehensive coverages.  (Collision covers the damage to the insured's vehicle due to a collision loss, while comprehensive coverage pays for damage to an insured auto for an event other than collision like fire, theft or hitting an animal.)

The standard deductible amounts on an auto policy range from $100 to $1000 and is applied per incident and not a calendar-year like some health insurance policies.

An auto policy also contains a lot of other coverages like liability, property damage, medical payments, etc. however there is typically not a deductible applied to these coverages.

Now that we know what a deductible is and what coverage it applies to, here are some guidelines as to when a deductible will apply to your auto insurance.

When You’re At-Fault for an Accident:

If you are found at-fault in a car accident, you’ll likely have to pay your policy’s collision deductible for the repair of your own vehicle.  If there is no damage to your own vehicle, but damage to another car or property (fence, sign, etc.) this would most likely be covered under property damage and no deductible applies.  This does not mean you would not be found "at-fault" but rather you would not be filing a claim under the collision coverage so the deductible would not be applicable.

When You’re in an Accident Caused by Another Driver:

If you’re involved in a multi-vehicle accident that’s caused by another driver, you theoretically shouldn’t have to pay your deductible. Since they’re at fault, all claims related to the accident should be filed against their policy -- which would mean your policy’s deductible doesn’t apply.

In reality, however, it’s sometimes necessary to pay your deductible even if you’re not responsible for an accident. Determining fault can take some time (a long time, in some cases), and the other driver’s auto insurance company probably won’t cover any claim you file until fault is officially determined. Should you want your car repaired before who’s determined at-fault, you’ll probably have to pay your policy’s deductible and hope to get it refunded later. 

In these situations, the process usually goes as follows:

1. To get your car repaired as quickly as possible, file a claim against your own car insurance policy.
2. Assuming you have collision coverage in place at the time of loss, your insurance company should pay for the repair of your vehicle, less your deductible.
3. Your insurance company then files a claim with the at-fault driver's insurance company to be reimbursed for all the money it paid on your behalf, plus your deductible.  This process is known as subrogation.
4. Assuming your insurance company is reimbursed 100% from the at-fault driverscar insurance policy, you will be reimbursed your deductible.                                            

You have a Comprehensive Claim:

If you have a covered comprehensive claim, you’ll probably have to pay your auto insurance policy’s comprehensive deductible. Comprehensive coverage generally protects your car from incidents that don’t involve other drivers. For example, your policy’s comprehensive coverage might cover break-ins, theft, hail, and hitting deer or other animals (a common occurrence in New Hampshire). In these situations, there isn’t another driver involved so you can probably expect to pay your comprehensive deductible.

Your Car’s Glass is Broken:

If your car’s windshield is broken, you might not have to pay your comprehensive (also known as other-than collision) deductible. In most cases you would, but some auto insurance policies offer "full glass protection" which can mean no deductible in exchange for a slightly higher premium.  This coverage enhancement typically applies to windshields and not other glass on the vehicle.  Check with your insurance professional to get the details and cost of this coverage as many people find it worth it.

Talk with Your New Hampshire Car Insurance Agent

If you have any questions about when you might need to pay a deductible, talk with your independent New Hampshire insurance agent. You don’t need to be filing a claim or requesting a quote to ask them a question. Simply call or email them, and they’ll be happy to further explain when you may need to pay your car insurance policy’s deductibles and possible options.

Stay safe!

This material is for informational purposes only. All statements herein are subject to the provision, exclusions, and conditions of the applicable policy, state and federal laws.  For an actual description of all coverages, terms and conditions, please refer to the applicable insurance policy or check with your insurance professional.