Car Insurance Deductible Calculator

A higher deductible lowers the premium but raises what you pay when you claim. The right level is where the annual saving beats the expected extra cost of claiming.

Lower deductibleThe smaller deductible option.Higher deductibleThe larger deductible option.Annual premium at lower deductiblePremium with the smaller deductible.Annual premium at higher deductiblePremium with the larger deductible.Expected claims per yearAbout 0.15 for a driver claiming every seven years.

Net annual benefit

$225.00

Annual premium saving: $300.00
Expected extra cost of claiming: $75.00

Values update as you type. This calculator covers the single scenario its formula assumes — see Common Mistakes for what it leaves out.

The formula this calculator uses

Net benefit = (low-deductible premium - high-deductible premium) - extra exposure x claim frequency

saving: Annual premium reduction from the higher deductible
exposure: Extra deductible you would pay per claim
frequency: Expected claims per year

How to check the result by hand

1
Get both premiums
Ask your insurer for the annual premium at the low deductible and at the higher one, with everything else in the policy identical.
2
Find the annual saving
Subtract the higher-deductible premium from the lower one. That is what you keep each year by accepting more risk.
3
Work out the extra exposure
Subtract the low deductible from the high one. That is the extra you pay each time you make a claim.
4
Estimate your claim frequency
Use your own history or a market average, roughly one claim every seven years, or about 0.15 a year, for a typical driver.
5
Compare saving with expected cost
Multiply the extra exposure by the frequency and subtract it from the saving. A positive result means the higher deductible is worth it on average.

For worked examples, common mistakes and the limits of this formula, read the full How To Calculate Car Insurance Deductible page.