How this calculator works
The yearly premium savings from the higher deductible are compared with the extra you'd pay if you file a claim. Break-even is that extra divided by the yearly savings. Expected cost adds the premium to the deductible times your chance of a claim.
Worked example
With the example values below: Higher deductible saves, $250 / yr (break even if you go 2.0 years without a claim). Change any number above to run your own.
What you enter
| Input | Example |
|---|---|
| Lower deductible | |
| Deductible | $500 |
| Annual premium | $1,900 |
| Higher deductible | |
| Deductible | $1,000 |
| Annual premium | $1,650 |
| Your risk | |
| Chance of a claim in a year | 10% |
How deductibles work
Your deductible is what you pay toward a collision or comprehensive claim before insurance pays the rest. Choosing a higher deductible, such as $1,000 instead of $500, lowers your premium because you take on more of each claim. Liability coverage has no deductible.
The right choice depends on how much you save on premiums, how often you're likely to claim, and whether you could pay the deductible out of savings.
The break-even test
Divide the extra out-of-pocket cost per claim by the yearly premium savings. If raising your deductible from $500 to $1,000 saves $150 a year, the extra $500 is covered after about 3.3 claim-free years. Most drivers file a claim less often than that, so the higher deductible usually wins.
Only choose a deductible you can pay from your emergency fund without strain.
Other ways to lower premiums
- Compare quotes every year or two.
- Bundle auto and home or renters insurance.
- Ask about safe-driver, low-mileage, good-student and telematics discounts.
- Drop collision and comprehensive on an older car worth little.
Frequently asked questions
Should I choose a $500 or $1,000 car insurance deductible?
A $1,000 deductible usually saves money over time if you can afford it in an emergency and rarely file claims. Compare the premium savings with the extra $500 per claim.
How much does raising your deductible save?
It varies by insurer and driver, but moving from $500 to $1,000 often lowers collision and comprehensive premiums by 10% to 20%.
Do I pay a deductible if the accident wasn't my fault?
Usually not if the other driver's insurer pays. If your insurer pays first, it may recover your deductible from the at-fault driver's insurer.
Does liability insurance have a deductible?
No. Deductibles apply to collision and comprehensive coverage on your own car.
When should I drop collision coverage?
When the car's value is low enough that yearly collision premiums plus the deductible approach what the car is worth.
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Estimates for planning only, not financial, tax or legal advice. Tax tools use 2026 federal figures (brackets, $16,100 / $32,200 standard deduction, $19,000 gift exclusion, $15M lifetime exemption). Rates shown as defaults are examples; replace them with quotes you actually receive.