Car insurance deductible
Updated for plan year 2026
In plain terms
A car insurance deductible is the amount you agree to pay yourself on each collision or comprehensive claim before the insurer pays the rest. Liability coverage has no deductible; only the coverages that pay for your own car do. A higher deductible lowers your premium because you are self-insuring the first slice of any loss.
A plain example
With a $1,000 deductible, a $4,000 repair means you pay $1,000 and the insurer pays $3,000. Raise the deductible to $500 and your premium goes up, but that same repair costs you only $500.
Why it matters
Your deductible is one of the few policy numbers you fully control. Setting it as high as your emergency fund can comfortably absorb trims your premium, but a deductible you can't actually pay defeats the point.