deductible buyback
Auto insurance deductible: operation, types, terms of payment
In the event of an event covered by an insurance contract, its holder may have to pay a remaining charge: the deductible. This is a sum not covered by the insurer, especially in the event of a responsible accident. The car insurance contract specifies the damage for which the insurer applies a deductible and the amount of the deductible(s) provided. How is a deductible determined? How to fix it and in what cases? Matmut explains the mechanism of deductibles in car insurance.
What is an auto insurance deductible?
The car insurance deductible corresponds to the sum that remains the responsibility of the insured after a claim and which will therefore not be reimbursed by the insurer. The goal: to encourage prevention and encourage drivers to drive more carefully.
In what cases do we pay the auto insurance deductible?
An auto insurance deductible is payable in two separate cases:
the insured must provide for a car insurance deductible in the event of a responsible accident,
a deductible must also be paid when the driver responsible for the accident has not been identified, is not insured or is insolvent.
Good to know
The share of liability plays an essential role in the allocation or reimbursement of a deductible. In the event of shared responsibility – that is to say that two motorists are equally responsible for the accident caused – each motorist will be responsible for his share of the car insurance deductible.
Also read: How to use the auto e-report?
How do I pay the auto insurance deductible?
An auto insurance deductible can take the form of:
a fixed price to be paid in euros,
a percentage of the amount of compensation,
a “fixed price-percentage” combination, for example: 15% of the indemnity with a ceiling set at 300 euros.
How are auto insurance deductible amounts determined?
The amount of the car insurance deductible varies according to the type of claim: it will not be the same whether it is a glass breakage or a car fire. The insurance contract must specify the type of deductible (see below) and how it is calculated.
Deductibles allow the insurer not to compensate small damages. As a result, their existence and their amount may possibly have an impact on the determination, by the insurer, of the premium relating to the guarantees concerned. However, insofar as they constitute a limitation of the guarantees, it is strongly recommended to compare the different contracts before any subscription. If in doubt, do not hesitate to ask for additional information.
Read also: How to choose the right car insurance in 10 criteria?
What are the different types of auto insurance deductible?
Depending on the contract taken out, the auto insurance deductible can take two different forms: the absolute deductible and the relative deductible.
What is the absolute deductible?
This is the most common type of franchise. It is a lump sum or a percentage which will be systematically deducted from the compensation for the damages covered, whatever their amount. An absolute deductible delimits the insurance indemnity since it is only due if the amount of damage is greater than that of the deductible applicable to the claim. More concretely, for a deductible of 200 euros, you will not receive compensation if the loss is estimated at 150 euros. On the other hand, if it is 2,000 euros, you will be reimbursed 1,800 euros.
What is the relative deductible?
Also called a simple deductible, this type of car insurance deductible is more rare in insurance contracts. The insurer stipulates that it does not cover damages if their amount is less than a sum fixed in the contract. On the other hand, if the amount of the damage is greater than that of the deductible, it compensates them in full, without applying any deduction.
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