If you’re having trouble paying your auto insurance deductible after an accident, what do you do? Chances are you need to get your car fixed as quickly as possible so you can get back to work and life. You may be wondering how to avoid paying your car insurance deductible when you can’t afford it.
The best thing you can do is prevent this situation from happening. you must adjust your deductible until you can afford it in order to have the money to cover it. But if it’s too late and you need to pay a deductible that you currently can’t afford, you have options.
what is the car insurance deductible?
According to Progressive, a car insurance deductible is the amount of money you must pay before your insurance company covers the rest of the costs. For example, if you need $4,000 to repair your car after an accident and you have a $500 deductible, then you’ll pay $500 before your insurance company pays the remaining $3,500.
having a lower deductible generally means you pay higher premiums each month and vice versa – having a higher deductible generally lowers your monthly premium costs.
Sometimes you find yourself in a situation where you can’t pay your deductible. In this article, we explore everything you need to know if you find yourself in a situation where you can’t pay your deductible.
How can I avoid paying a car insurance deductible?
To get the money from your insurance claim, you’ll need to pay your deductible. If you don’t have the money right now, you can choose not to file a claim. For example, if your car is functional after an accident and has only cosmetic damage, you can take your time filing a claim. That way, you can save your deductible money before you file a claim. These are your options when you can’t pay your deductible:
- opt not to file a claim until you have the money.
- check your policy, as you may not have to pay up front.
- make a deal with your mechanic.
- get a loan.
check your policy
It’s always important to know the details of your policy when it comes to deductibles. According to AutoInsuranceQuote, some insurance companies do not require you to pay your deductible up front. these companies are willing to subtract your deductible directly from the money in your claim.
For example, if your claim is valued at $10,000 and your deductible is $500, your auto insurance company will write you a check for $9,500. that’s your claim amount minus your deductible.
In this case, you won’t need to pay your deductible before any repairs are done. If you’re not sure about your policy, ask your insurance agent if you need to pay your deductible up front.
talk to your mechanic
In some rare cases, says Auto Insurance Comparison, a mechanic might be willing to waive their deductible entirely. although unlikely, it’s worth asking your mechanic if this is an option. this practice is not illegal, so you should not feel uncomfortable asking. The mechanic could be making so much money on the repairs that the shop is willing to waive the deductible or allow you to make payments over a longer period. For example, he could work out an agreement in which he pays his deductible in monthly installments.
In this situation, the mechanic would bill the insurance company for the cost of the repairs, minus the deductible. the body shop would then allow you to make payments to cover the remaining portion of the bill or waive your deductible entirely. the mechanic basically covers the deductible for you and then you pay the shop back.
however, if you don’t make the payments to cover the rest of your deductible, the mechanic has the legal right to own your vehicle until you pay it.
Please note that it is illegal for your mechanic to overcharge your insurance company in an attempt to recover a waived deductible. that would be considered insurance fraud, according to autoinsurancequote. It is also illegal for the mechanic to use aftermarket parts while charging the insurance company for direct company parts to avoid paying the deductible. asking a mechanic to do this for you could land you in jail and lose a lot more than money and a car.
get a loan
Lastly, you may choose to take out a loan such as a payday loan to cover your deductible, says Auto Insurance Comparison. Although the interest rates can be very high, payday loans do not require a credit check and you can get money within 24 hours.
You will be able to pay your deductible and finish the repairs. then take the time to save money and pay off your loan.
in conclusion: lower your deductible
Your insurance won’t help much if you can’t pay your deductible. Ideally, says the balance, your deductible should be an amount you can easily pay out of pocket when an accident occurs. that amount will vary based on your budget and the amount of cash you have on hand at any given time.
If your deductible is too high and you can’t afford it, you can adjust your deductible by paying higher premiums each month. Paying more each month may seem inconvenient, but it can save you a lot of trouble if you’re in an accident. You need to be strategic about your deductible and choose the right amount for your situation. otherwise your claim will not be processed and you will not be able to get your car repaired in a timely manner. Not having a car can leave you in a bad financial situation if, for example, you can’t get to work without your car.
Check your policy to make sure you can afford your deductible. If you can’t, adjust your monthly premiums until the deductible is low enough to be affordable.