What is the maximum deductible on collision coverage for damage to the insured auto?

What is the maximum deductible on collision coverage for damage to the insured auto?

• A. $100
• B. $250
• C. $500
• D. $1,000

Answer: (B)

Collision coverage uses a deductible, which is the amount you must pay out of pocket toward a covered repair before the insurer pays the rest. You choose this deductible level, and a higher deductible reduces the premium because you’re taking on more of the cost yourself. In this item, the maximum deductible is the highest level offered within the policy’s standard deductible options, so selecting that level minimizes the premium the insurer charges. The key idea to grasp is that the deductible is the portion you pay first per claim, and choosing a higher deductible lowers your premium while the policy’s coverage limit remains the same.

Collision coverage uses a deductible, which is the amount you must pay out of pocket toward a covered repair before the insurer pays the rest. You choose this deductible level, and a higher deductible reduces the premium because you’re taking on more of the cost yourself. In this item, the maximum deductible is the highest level offered within the policy’s standard deductible options, so selecting that level minimizes the premium the insurer charges. The key idea to grasp is that the deductible is the portion you pay first per claim, and choosing a higher deductible lowers your premium while the policy’s coverage limit remains the same.