When Is The Car Insurance Deductible Waived?

When it comes to car insurance, the deductible is the amount of money you must pay for auto repairs before your insurance company pays for your claim.  If you get into an accident with $7,000 worth of damage and you have a $1000 deductible, for example, you will pay $1000 to your insurer and they will pay the remaining $6000.  Although much less than the cost of the full repair, the deductible is still often times very expensive and not everyone can afford it.  Fortunately, in some special situations, the deductible can be waived.deductible waiver

Often times, there is only one way in which your insurer can waive your deductible.  And that is when you are involved in a collision with another vehicle and they are determined to be at fault.  Their insurance company will accept full responsibility and then will reimburse you for the full damage involved, deductible included.

One of the few situations in which deductibles can be waived is windshield claims.  Windshield repairs, which are covered by comprehensive coverage policies, are defined separately in most policies.  If you have comprehensive coverage, you may owe much less (or nothing at all) for a deductible if you are to get your windshield repaired.  If it is a small nick or a small crack on your windshield, your insurer might go ahead and repair it for you at no cost whatsoever.  Call your insurance company to find out for sure if your policy covers windshield damage with no deductible.

In some states, like Michigan, there is a deductible waiver that you can buy or add-on to your policy.  In these states, if you have the deductible waiver, you will not be required to pay your deductible under certain circumstances, for example, you are hit by someone with the same insurance company, or your car is deemed to be a “total loss”, or you are hit by an uninsured motorist.  If you do not buy this waiver, however, you could be out of luck.  Ask your insurance agent if there are any deductible waivers available to add to your policy, otherwise, you might end up paying for your deductible in-full come repair time.

Be Careful Of Repair Shops Willing To Waive Your Deductible

Sometimes an auto repair shop will offer to waive your deductible.  They do this, behind the backs of the insurance companies they work with, to entice drivers to patronize their shop for repairs. Usually, this is both illegal and unethical as it cuts into the insurer’s profits.  The way it works is that the repair shop would over-inflate the estimate for the repair cost so that the insurer ends up paying the entire amount of the damaged vehicle’s repairs, including your deductible.  This is unethical and fraudulent because it ignores the deductible amount that you agreed to in your policy.

Be wary of auto body shops that offer to lower or waive your deductible.  Not only is this practice illegal, but it’s also risky to you, as a consumer.  If they are willing to cut corners with the insurance company, they might cut corners repairing your vehicle or not give it the proper care it needs.  In addition, the chances of a fraudulent repair shop staying in business for the long term is slim-to-none, so don’t even think about them honoring any warranty you might have.

In general, when it comes to car insurance, you should expect to pay some kind of deductible when you get repair work done.  After all, paying a deductible is what you agreed to when you signed your policy. Talk to your insurance agent to get a better idea of what you will owe when it comes time to do repairs.


  Comments: 33

  1. it’s NOT illegal to waive a deductible at all… Where the hell did you get this information?

    Typically your insurance company gives you a check for the damages you could just deposit that check and never get the car fixed as far as insurance is concerned. If you go to a shop with that check and they are able to do the repair for that then there’s no problem at all and no laws are being violated. You are allowed to go to any body shop you want regardless of whether it’s one your insurance does business with or not. If that shop is willing to discount the work equal to your deductible it’s not illegal at all. They can run their shop however they want.

    • Thanks jake for ur info, i didnt think wavei ng the deductible was illeagle either!

    • That’s right Jake it’s not illegal or unethical to waive the deductible. The deductible is paid to the body shop not to the insurance company. If a shop wants to waive it, it’s their business between the consumer and body shop not the insurance companies.

    • READ (if you know how) the information above you idiot(s). It clearly states: “The way it works is that the repair shop would over-inflate the estimate for the repair cost so that the insurer ends up paying the entire amount of the damaged vehicle’s repairs, including your deductible.” This is not the repair shop simply accepting a lower price; this is FRAUD and yes, highly illegal in ALL states.

    • Armando@4AutoInsuranceQuote

      Hello Jake,

      As another user mentions below, the article is describing the unethical practice of the auto repair shop inflating the prices on your repair estimate, by submitting unnecessary repair supplements or any other means, to offset the “discount” they are giving you. When the shop is dealing with the insurer for repairs through a claim, they should (and are likely required by law) to disclose all necessary costs for repairs and should not be charging or discounting anything on the side. If the business was truly between you and the shop (excluding the insurer altogether) then sure, they can give you whatever discount they choose. Think about it, what reason would a shop have to “waive your deductible”? If they were truly legitimate, that’s money they’re missing out on (either $500, $1000, $2000, etc.) and for what? To do you a favor?

      • Well what if you don’t have the money up front to pay the deductible I don’t see a problem if the shop chooses to waive it for the customer. I don’t think its fraud I think its good will helping. That’s not fraud, like you said what is a few hundred dolllars.

      • Truly legitimate shops waive deductible every day and do it legally and ethically.

        Insurance adjustors are the ones who approve estimated repair costs after inspecting the vehicle themselves. The shop is working with an insurance approved estimate.

        If the shop decides to lose $500 deductible on the repair in order to incentivize a customer to use their shop is entirely legal and ethical.

        EXAMPLE: Why would grocery stores offer two for one offers, or discount off of their MSRP if they were legitimate? BECAUSE they want you to buy from them and not their competitor, so they are will to take a loss on their PER ITEM profits and bet on increased VOLUME.

      • Yes. Why not? Isn’t that good business practice, treat your customers well and they may return? Or is that a lost art?

        In the end, the claim that the insurer won’t pay until the insured pays the deductible is actually criminal. Imagine, the insurer says there’s $5000 worth of damage, but until you pay the deductible we aren’t paying squat. And the insured is forced to do what, walk to work? The premise that one pays the deductible to the insurance company is also ridiculous. The company is only paying their portion. If the insured pays the company, aren’t they being charged twice? Come on, this is ridiculous. If a company says hey, if you can’t afford x, we’ll cut out the 3 hours of buffing the scratch out here which will save you $250 in labor costs, how the heck is that illegal?

    • Jennifer White

      Jake you really relieved my anxiety. Thank you. I just had a major accident today and I’m the sole provider for my kids.

    • It becomes illegal when you don’t notify the insurance of the change of the repair. Say you got paid to cover an OEM bumper and radiator support but you put on aftermarket to save the deductible. The insurance has paid for a service and is warranty that service in that fashion. It also devalues the car which could effect their coverage. Lastly those parts are not crash tested and the liability of any future issue would be on the shop alone. The other part that makes it illegal would be the purposely over inflating the estimate. An estimate is a legal binding document.

      • Wrong. The insurance company gives you an estimate. Then they subtract the deductible from that estimate. Some companies will give that check you the insured directly. Others, depending on the state you live in, may require a lien holder to get the check co-signed. Or may send the check directly to the repair shop. But what he adjustor estimates is what the company will give you, minus any deductible. It’s not illegal and it’s not immoral. Is your right as a consumer. If this was the case, then what about those who can fix the car themselves? Is one supposed to be forced into having a shop do the work? It’s a preposterous assertion.

        However, I do agree that inflating a repair job to get more money from the insurance company is fraud. That’s an entirely different scenario than what Jake is stating.

    • Jake. Do you happen to know what options I have or what I can do. Let me explain
      My car was parked and was damaged in 3 different parts. On the front bumper right by the tire on pasangers side and the back bumper. It all happened In the same incident. I obviously didnt find out who did it so I reported it to my insurance and I’m being told it has to be treated as 3 different claims and that I have to pay three times my deductible! I believe that’s so unfair because this car was in perfect condition right before this happened. Do you know what I can do or say to my insurance? After all I’m not even sure if it was vandalized or hit by another car

    • You are absolutely right! So that previous comment probably was from a Insurance Co.

    • My insurance company will NOT repair my car unless I pay my deductible upfront. They even referred me to the at-fault driver’s insurance company to supply ALL my info to them! The “other insurance” is dragging his feet. What am I missing here?

  2. Deductibles are not paid to insurance companies. The deductible is the amount the person agrees to pay. This amount is generally deducted from the estimated cost of repair. Most insurers write their own estimates if over a certain dollar amount. This article is completely wrong. No one pays a deductible to the insurance company.

  3. If the estimate is 1400 and the deductible is waived and the insurance company sends a check for 1900.Who gets the difference?

    • Armando@4AutoInsuranceQuote

      Hello Edgar,

      Who was the check sent to? If it was sent to your person than I would suggest cashing it, paying the $1400 to repair your vehicle and pocketing the rest. If it was sent directly to the shop, then that money should still belong to you and you should ask for it. There is no reason the shop should be receiving a penny above the estimate amount unless they filed a revised estimate or an estimate for supplemental damages (above the original estimated damages) that the insurance company agreed to. I would highly suggest discussing the situation with the insurance adjuster that was assigned to your file and asking them what you should do next.

      • There is no reason the shop would be receiving a penny over the estimated cost. That’s the stupidest thing I ever heard. that’s their job. they make what ever is left over. why would you keep any of that money? to me that sounds illegal. The money should be for parts and getting the car fixed and paying whoever worked on it… and it’s okay if a body shop wants to waive a deductible

  4. Wow this place just showed why you shouldn’t get a quote from them. This has never been illegal and as far as Michigan you have that wrong too. I lived their for over 25 years and you do NOT buy anything extra to have your deductible waived.
    You should know what your talking about before posting information like this.

    • Armando@4AutoInsuranceQuote

      Hello Wesley,

      I respectfully suggest you do some more research on the subject before you post information that may confuse other readers. Michigan is a special case as it’s the only state that requires drivers to carry collision coverage AND file claims through their own insurance policy regardless of fault. As you say it is possible to request to have your deductible waived if you were not at fault for the accident, however that would not be the case if you were found to be at fault. That’s where the CDW (Collision Deductible Waiver) would come in handy and cover your collision deductible.

      • You said Michigan is the only state that requires drivers to file claims through their own insurance company regardless of who’s at fault… sorry but you are dead wrong in that one! I live in Florida and our state requires that, too. So apparently you don’t give very good advice or information!

  5. This is partially a hypothetical question because I don’t know what my daughter’s car is worth. So if her car is worth $7,000 and she has a $1,000 deductible but can’t come up with it, can she just get $,6000 and the insurance company just keep the remaining $1,000 for the deductible?

    • Armando@4AutoInsuranceQuote

      Hello Melissa,

      You are thinking about a total loss case, where the insurance company would pay you the actual cash value for the vehicle less the deductible. To get an idea of the actual cash value of the vehicle, you should look up several of the same vehicle (closest match and condition as possible) that are for sale in the area. You could take it a step further and get an appraisal on the vehicle. The insurance company would determine the actual cash value at the time of the appraisal. For the car to be deemed a total loss, it typically needs to sustain damage over a certain percentage of it’s worth (usually 70-80%). In the case of a total loss, the insurer will generally take the vehicle or may give you the option to keep it, but will charge you salvage (what they would have reasonably expected to sell it for at auction).

  6. What if my car is fixed I owe the Collision company deductible what if I don’t pay it and take my car what will happen

    • Armando@4AutoInsuranceQuote

      Good afternoon Vet,

      Normally a shop wouldn’t start repairs on a vehicle unless you pay the deductible up front and if they do repair your vehicle, then they may have grounds to hold onto it (and charge you storage per day) if you refuse to pay what you owe. The deductible is the part of the repair bill that is your responsibility and that the insurance company doesn’t pay them for. If you do somehow manage to take your repaired vehicle home without paying your deductible, then the shop or possibly the insurance company will send it to collections, damaging your credit score.

      • I would like to know what can I do when the place where I took my vehicle took 3 months to repair it and the quality of the service is very poor and unprofessional,irresponsible careless about the customer and I would like then to waive my diductable , I loss wages because I have to give my car away to my family member so don’t stop working and loosing more mone ?

  7. Mr. Percy Brown

    Who do you pay deductible to ? The repair shop or the insurance company ?

    • Armando@4AutoInsuranceQuote

      Good afternoon Mr. Brown,

      The deductible is typically paid to the repair shop before repairs begin because it’s the portion of the bill that is your responsibility and that the insurance is not paying them for. Although if you decide not to repair your vehicle right away, the insurance company may issue you a check, based on your damage appraisal and less your deductible, to take to a shop of your choosing whenever you want to. If you don’t agree with the insurance company’s appraisal of your damages, you do have the option of hiring an independent adjuster to appraise your damages and then submit that to the insurance company for review.

  8. Having a disagreement with a Semi Truck driver who has told me that his deductible is waived because he has installed cowbars. have you heard of this or is he talking about a savings on his premiums because of these cowbars. I have not heard of any insurance company that waives deductibles for added protection, but then not sure what is available across the insurance companies.

  9. Not surprisingly, the insurance company is giving you wrong info here. Reducing or waiving a deductible is not illegal.

    The body shop estimate is reviewed by the insurance company, so it is up to them to determine if it is over-inflated.

    The body shop can save you your deductible in an number of ways.

    1) they discount the job to get the business. They do $7,500 worth of work and charge you $7,000 to save you the $500 deductible, a 6.7% discount. A lot of small businesses would take that discount for business.

    2) they to do less work. It’s your car, you don’t have to fix anything, let alone everything. So, you might have a scratch from the accident on the bumper, which by terms of your insurance company needs to be fixed. The time to mask, prime, paint and seal coat this small repair might exceed your deductible. So, you can fix your hood, fender, etc, and live with the small scratch and save $. And maybe fix it with some touch up paint for $10.

    3) they can do the repair with after-market parts if OEM part we estimated. Again, it’s your car, you decide what you want.

    Insurance companies screw people every day. For example, my parked car was totalled by a snow plow truck. My insurer was estimating my loss amount. When they found cars for sale like mine to average for my payment, if the mileage on the car for sale was less, they deducted 3 cents per mile off of the amount used for my payoff. If the mileage was more, they added 2 cents per mile.

  10. I have a situation in which the insurance company paid me their initial estimate of the damage of an at fault collision. However I immediately had my vehicle taken to one of their recommended repair shops. When picking up the vehicle I was told I would need to pay a $500 deductible , which I paid, and that the insurance company had already paid the rest including any supplemental cost. I was told have a nice day grabbed my keys, drove my repaired vehicle home and have documentation stating how much I am reliable for, the $500 and how much the insurance company will pay, which is the rest. According to my insurance company the case file is now closed. So. That leaves about 4,000 extra dollars in my bank account. Someone dropped the ball between them, and i’m not sure how much time I want to spend finding out where and when this money goes. Advantage or liability?

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