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What Happens If You Can’t Pay Your Car Insurance Deductible?

A car insurance deductible is the money that you owe to the insurance company before they pay for damages. You are required to pay the deductible, or the insurance company will refuse to pay for those damages. The only way to avoid paying a deductible on a claim is by not making that claim. Your car insurance will not pay for any damages until the deductible is paid for. 

Do I Have to Pay The Deductible Immediately?

There are a few ways to save money for the deductible. Firstly, you can save money before the accident even happens. If you know that your deductible is hefty, consider keeping the cash-on-hand before the event of an accident. Another solution is to continue driving your damaged car before filing an insurance claim. Keep certain state laws in mind! You cannot drive without headlights or brake lights, for example. The car must be safe to drive to be legal to drive.

If the car is safe to drive, then you are good to go. File a car insurance claim later when you have the money. Another solution is to pay a mechanic on the side, cutting your insurance company out entirely. This would only work if you are not liable for the accident, or if no other driver was involved. This is practical for smaller damages that you can cover out of pocket. Generally, if the damages cost less than your deductible, simply pay for them out of pocket.

Paying The Deductible Later

Depending on your insurance company, you may be able to pay for the deductible later. The insurance company pays for the damages upfront, and you are expected to pay the remaining amount. This means that the damages are not paid for in full. Instead, you are responsible for the last few hundred or thousand dollars equal to the amount of your deductible. 

If your car is totaled, the insurance company may simply subtract the deductible amount from your settlement check. Most insurance companies do not mind meeting the cash value of the vehicle minus the deductible. They cover the cost of the vehicle for the mechanic, or they pay for your settlement check directly. This allows you to get a new vehicle as quickly as possible without having to save for a deductible. 

What Are Alternatives To Paying For My Deductible?

If you have a direct line to the mechanic, you can ask them to pay for your deductible. If the mechanic knows that you cannot afford it, they may take your insurance company’s payment and waive the amount that you owe. This is a good solution since mechanics are legally allowed to keep your car if they do not receive a payment. A mechanic with a full shop may not want to keep your car. A car with little value has little use to a mechanic. Allow them to weigh their options. Accepting your deal might have a greater reward than fixing up a car that they cannot sell. It is a better deal to take the insurance company’s money, especially if you cannot pay your deductible.

Other alternatives include pawning useless items or getting a loan. Both of these solutions have risks and rewards. Reconsider your deductible. Is it affordable? Can you pay it at a moment’s notice? If not, consider changing the amount of your deductible before it is too late.