How to Recover Insurance Deductibles

Broken windshield
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When you file an insurance claim, your provider usually requires you to pay a deductible. You and your insurance company will have agreed on amount of the deductible when you took out the policy. This amount usually appears on the first policy page, under "coverages." Whether or not you get your deductible payment back again depends on several factors.

The Mathematics of Deductibles

Insurance allows you to replace a large, uncertain risk with a small, certain payment -- the insurance premium. The buyer gets security at a fixed cost; the seller accepts risk at an agreed-upon price.

In most instances, both the buyer and the seller are willing to modify the agreement by including in the insurance policy an amount to be deducted from the insurance seller's payment to the buyer -- the deductible. This effectively transfers back to the buyer a portion of the seller's potential risk. In return, the seller lowers the amount of the premium payment.

Liability and the Deductible

In many instances, the buyer of the insurance is not at fault. For example, a car crash might occur because of another driver's negligence. Most policies acknowledge this difference between an accident where the insured is at fault and an accident caused by another driver. In those instances where your company's investigator determines you were not at fault, your insurance company may work to get the other party's insurance company to pay the deductible amount along with the other repair costs. How your insurance responds, however, depends upon your coverage -- the kinds of damage and injury you've insured against

Recovery of Deductibles

If you have only liability coverage, which covers the other party's property damage and bodily injury, your insurance company will not reimburse the deductible amount and will not attempt to recover it from the other insurance company. On the other hand, if it's determined that you were not at fault and your policy includes collision damage to your car, your insurance company will pay the full cost of your auto repairs along with any associated expenses, such as car rental payments. However, they may or may not return your deductible.

Disputes over Responsibility

Your insurance company will return your deductible payment only if the other party's insurance company agrees to accept responsibility and pay for the damage to your car. When they do not, your insurance company will still pay your repair costs, but ordinarily will not refund your deductible payment.

A driver may believe that if she has comprehensive as well as collision coverage, the insurance company will always return the deductible. This is not the case. Comprehensive doesn't mean everything's covered; it means only that damages to your car are covered when it cannot be determined that anyone is at fault -- for example, when a falling tree causes the damage.

When the other insurance company refuses to accept responsibility for a two-car accident, you may have to sue in small claims court to recover your deductible payment from the other insurance company.

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