How Your Deductible Works After An Accident
You can't always plan when you get into an accident. When you get into an accident, your insurance company's job is to fulfill their legal obligation to you. It is their job to get the vehicle towed to an auto shop, assess the damage, and figure out if your vehicle is totaled or if your vehicle can be fixed. It is your job to pay the deductible.
#1 Your Deductible Isn't Due the Day of the Accident
You are not expected to fork over the cash for your deductible on the same day you get into an accident. Generally, you have a little time to get your money together. You will need to pay before the claim is complete though. That means when your vehicle is in an accident, your auto insurance company will have to assess the damage to your vehicle. This process generally takes at least a few days and can take up to a week.
#2 If Your Car Is Totaled, You May Not Have to Pay Your Deductible
If your car is totaled, you may not have to pay a deductible. Most of the time, when your car is totaled, your vehicle is assessed at a certain value and then your deductible is subtracted from the actual cash value.
As an example, if your car is totaled, and your insurance company determines that your vehicle is worth $11,000 and your deductible is $500, they will just subtract the $500 from the total. Instead of getting $11,000 cash for your vehicle, you will get $10,500. Your insurance company "pays" your deductible with the money they are going to pay you. It doesn't make a lot of sense for you to pay your insurance company $500 and then for your insurance company to pay you $11,000, which is why most insurance companies will subtract your deductible from your actual cash value that they will pay out.
#3 If Your Car Is Damaged, You Have to Pay Your Deductible To Get Your Vehicle Fixed
When you have to pay your deductible after your car was damaged varies based on your insurance companies. With some insurance companies, you'll be asked to pay the deductible before the insurance company authorizes the auto mechanic to go forward with the repairs. With other auto insurance companies, they will ask you to pay the mechanic the deductible. The mechanic may ask you to pay the deductible before they start working on your vehicle or after they finish the work; it really depends upon the auto body shop.
If you are struggling to pay the deductible, the auto body shop may be willing to work with you and arrange financing or accept payments on the deductible. If you find yourself in this situation, be aware your mechanic can hold onto your car until you pay what you owe them in full.
#4 If You Don't Have the Money, Borrow What You Need
If you don't have access to the money for your deductible right now, you should investigate getting a loan. You can get a personal loan or a check advance loan. It is often worth it to get a short-term loan to pay off your deductible if the damage to your vehicle is significantly greater than your deductible. For example, if your deductible is $500 but the insurance company is paying $4,000 to fix your vehicle, you are getting $3,500 out of the deal. It is best to take out a loan to and get the full benefit of your insurance coverage.
For more information on deductibles, get in touch with an agency such as Wolf Insurance Agency.
