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Car insurance deductibles and coverages: Choosing well-Auto Insurance

Learn what a car insurance deductible is and how it affects your car insurance coverage.

Car insurance — we all know we need it. But beyond that, many of us still ask ourselves, "What auto insurance should I get?" The key is knowing what deductibles and coverages are and how they affect auto insurance. So without further ado, here's a primer.

What is a deductible?

Put simply, a deductible is the amount that you agree to pay up front when you make an insurance claim, while the insurance company pays the rest up to your coverage limit.

When choosing your car insurance deductible, think about how much you're willing to pay out of pocket if you need to make a claim. Weigh that against the fact that higher deductibles generally mean lower premiums. It really comes down to what makes you the most comfortable.

Auto insurance policies generally consist of several kinds of coverages. Because insurance laws vary from state to state, the following information is here to give you a broad overview of typical coverages, and it isn't a statement of contract. In most cases, if you file a claim, you will first pay the deductible amount, and then your insurance will cover the additional amount.

Auto liability

Auto liability coverage, with limits selected by the insured, pays for the damage if you're legally responsible for injuring someone, or for damaging another vehicle (or other property) in an auto crash.

Auto liability coverage falls into two categories:

Bodily injury liability: medical expenses, pain and suffering, lost wages and other special damages

Property damage liability: damaged property and may include loss of use

Liability coverage also pays legal defense and court costs. State laws usually dictate the minimum amounts of insurance required, but higher amounts are available.

Personal injury protection (PIP)

This coverage is only available in certain states. It pays your (or another covered driver's) reasonable and necessary medical expenses for treatment caused by an auto crash. It may also pay for:


Lost earnings

Replacement of services (e.g., child care if a parent is disabled)

Funeral expenses

The coverage varies by state and specific policy.

Medical payments

This coverage is available in many states. It pays for necessary medical and funeral expenses for those covered when the expenses are caused by an auto crash. Medical payments coverage varies by state and specific policy.


Collision coverage helps pay for loss or damage from a crash to a covered vehicle caused by the following and usually requires a deductible:

Collision with another vehicle

Collision with an object


This coverage helps pay for loss of or damage to an insured, covered vehicle that is not caused by a collision or vehicle rollover. Examples of this type of damage or loss include:







Hitting an animal

Comprehensive coverage on your auto insurance usually requires a deductible but certain policies may have no deductible.

Uninsured motorist

This coverage pays for damages if you or another covered person is injured in an auto crash caused by a driver who does not have liability insurance. In some states, it may also pay for property damage. The coverage varies by state and depends upon policy provisions. Uninsured motorist coverage is subject to a policy limit chosen by the insured.

Rental reimbursement

This coverage pays for rental expenses if your car is disabled due to a covered loss. Daily allowances or limits vary by state or policy provisions.

Emergency road service

This coverage pays for roadside assistance such as having your auto towed due to a breakdown or getting back into your locked car. Towing limits vary by state or policy provisions.

How much car insurance do I need?

Unfortunately, there's no black and white answer. It depends a lot on what coverages you need and the amount of deductible or policy limits you feel comfortable with. Contact a State Farm® agent today to find out what's right for you.