Insurance Deductible Calculator
Compare insurance deductibles side-by-side. See exactly how much you save on premiums vs. increased out-of-pocket risk. Calculate break-even points to make the smartest decision.
How This Deductible Calculator Works
Your deductible is the amount you pay out-of-pocket before insurance kicks in. Higher deductible = Lower premium. But is it worth it? This calculator shows the REAL math behind the tradeoff.
What We Calculate
- Premium Savings: Annual savings from raising your deductible
- Risk Increase: Additional money at risk in case of claim
- Break-Even Point: Months without a claim needed to recover the risk
- 5 Deductible Options: $250, $500, $1,000, $2,500, $5,000 comparison
- ROI Analysis: Is the premium savings worth the additional risk?
Typical Deductible Savings
Save ~$50-100/year. Break-even: 2.5-5 years claim-free.
Save ~$100-200/year. Break-even: 2.5-5 years claim-free.
Save ~$200-400/year. Break-even: 3.75-7.5 years claim-free.
Save ~$300-500/year. Break-even: 5-8.3 years claim-free.
The Golden Rule
- • Only raise your deductible if you can afford to pay it TODAY from emergency savings
- • Never use a high deductible as a way to afford insurance (you're transferring risk to yourself)
- • Small claims (under $2k) often aren't worth filing due to rate increases
- • Most people who raise deductibles come out ahead over 5+ years
Frequently Asked Questions
Should I increase my insurance deductible?
Increase your deductible if:
- You have emergency savings to cover the higher deductible
- You haven't filed a claim in 5+ years (you're a low-risk customer)
- You're willing to pay for small repairs out-of-pocket ($1k-$3k)
- You want to save on monthly premiums (10-30% reduction possible)
Keep a low deductible if:
- You don't have $1k-$5k in emergency savings
- You file claims frequently (every 1-2 years)
- You prefer predictable monthly costs over lump-sum expenses
- You have high-risk factors (old home, high-crime area, teen driver)
How much does increasing my deductible save on premiums?
Auto Insurance Deductible Savings:
- • $500 → $1,000 deductible: Save 10-15% on collision/comprehensive (~$75-150/year)
- • $500 → $2,500 deductible: Save 25-35% on collision/comprehensive (~$200-300/year)
Homeowners Insurance Deductible Savings:
- • $500 → $1,000 deductible: Save 5-10% (~$50-100/year on $1k premium)
- • $1,000 → $2,500 deductible: Save 10-20% (~$100-250/year)
- • $2,500 → $5,000 deductible: Save 15-30% (~$200-400/year)
Note: Savings vary by insurer, location, and coverage amount. Get quotes to see exact savings.
What is the break-even point for a higher deductible?
The break-even point is how long you need to go claim-free before the premium savings offset the higher out-of-pocket risk.
Example calculation:
- Current deductible: $500 ($1,200/year premium)
- New deductible: $1,000 ($1,050/year premium)
- Annual savings: $150/year
- Additional risk: $500 ($1,000 - $500)
- Break-even: $500 ÷ $150 = 3.33 years
If you go 3.33 years without filing a claim, you've broken even. After that, you're making money on the higher deductible.
Can I have different deductibles for different coverages?
Yes! Most insurance policies let you set different deductibles for different coverages:
Auto Insurance:
- Collision deductible: $250, $500, $1,000, $2,500 (most people choose $500-$1,000)
- Comprehensive deductible: Can be different from collision (many choose lower $250-$500)
- Strategy: Higher collision ($1,000), lower comprehensive ($250) - comp claims rarely increase rates
Homeowners Insurance:
- All-other-perils (AOP) deductible: Flat dollar amount ($500-$5,000)
- Wind/hail deductible: Often percentage (1%-5% of dwelling coverage) in coastal areas
- Hurricane deductible: Separate higher deductible (2%-10%) in FL, TX, SC, NC
Does filing a claim affect whether I should have a high or low deductible?
Yes - small claims can cost you more than just the deductible:
- Rate increase: A single claim can increase premiums 20-40% for 3-5 years
- Example cost: $2,000 claim with $500 deductible. Net payout: $1,500. But premium increases from $1,200 → $1,500/year (+$300/year for 5 years = $1,500 total). You gained NOTHING and lost claim-free discount.
- Rule of thumb: Only file claims worth 3x+ your deductible
This is why high deductibles make sense: With a $2,500 deductible, you only file major claims (worth the rate increase). Low deductibles tempt you to file small claims that backfire financially.