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Written byCourtney Washington
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Courtney Washington is a Texas A&M University graduate. Her extensive knowledge and background in auto, home, and umbrella policies make her a one-stop shop for insurance advice and information. She loves to help her readers understand their insurance choices so they can make informed decisions about their coverage.
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Edited byAshley Cox
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7+ years in content creation and management
5+ years in insurance and personal finance content
Ashley is a seasoned personal finance editor who’s produced a variety of digital content, including insurance, credit cards, mortgages, and consumer lending products.
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Table of contents
A car accident can be costly, especially for drivers with high deductibles or who file claims frequently. But several companies offer a vanishing deductible to reward drivers for avoiding accidents.
A vanishing deductible, also known as a diminishing or disappearing deductible, is an optional feature some insurers offer. Every year without filing a claim equals immediate credit toward your comprehensive or collision insurance deductible. If you’re safe on the road long enough, you could pay $0 toward your claim when you need to file one.[1]
Cheapest recent rates
Drivers using Insurify have found quotes as cheap as $40/mo for liability only and $65/mo for full coverage.
*Quotes generated for Insurify users within the last 10 days. Last updated on December 10, 2025. Actual quotes may vary based on the policy buyer’s unique driver profile.
Rates shown are real-time Insurify user quotes from 500+ insurance companies and Quadrant Information Services data. Insurify’s algorithm excludes anomalous quotes and anonymizes personal details, then displays refined quotes by price, date, and insurer popularity up to 10 days ago from December 10, 2025. Actual quotes may vary based on the policy buyer’s unique driver profile.
*Quotes generated for Insurify users within the last 10 days. Last updated on December 10, 2025. Actual quotes may vary based on the policy buyer’s unique driver profile.
Rates shown are real-time Insurify user quotes from 500+ insurance companies and Quadrant Information Services data. Insurify’s algorithm excludes anomalous quotes and anonymizes personal details, then displays refined quotes by price, date, and insurer popularity up to 10 days ago from December 10, 2025. Actual quotes may vary based on the policy buyer’s unique driver profile.
How vanishing deductibles work
A vanishing deductible decreases a driver’s out-of-pocket expenses by a set amount every policy term they go without filing a claim. Companies typically reduce your deductible by $50 every six months or $100 annually. Some insurers impose a maximum amount of $500 or $1,000, while others don’t have a limit on their vanishing amount.
You may pick a higher deductible so that you’ll pay a lower monthly premium for your coverage. But this means that if you were in an accident, you’d have to pay that high deductible out of pocket before the insurance company covered the rest of the damages.[2]
With a vanishing deductible, you can choose a higher deductible to benefit from a lower premium. And you also get to pay less out of pocket when filing a claim if you’ve been violation-free for a certain amount of time.
Good to Know
Some insurance companies offer vanishing deductibles as an add-on to an auto insurance policy, while others include vanishing deductibles as part of a package. Either way, you pay an additional fee to include the vanishing deductible option on your auto policy.
Car insurance companies that offer a vanishing deductible
The companies in the table below offer vanishing deductible programs.
 |  |  |  |  |
|---|---|---|---|---|
Average price Prices based on average across state-minimum and full coverage car insurance $108/mo* | Average price Prices based on average across state-minimum and full coverage car insurance $185/mo* | Average price Prices based on average across state-minimum and full coverage car insurance $139/mo* | Average price Prices based on average across state-minimum and full coverage car insurance $135/mo* | Average price Prices based on average across state-minimum and full coverage car insurance $144/mo* |
Overall rating 3.9 | Overall rating 3.5 | Overall rating 4.3 | Overall rating 3.2 | Overall rating 4.8 |
Value for money 3.4/5 | Value for money 3.2/5 | Value for money 3.8/5 | Value for money 3.2/5 | Value for money 4.3/5 |
Customer service 3.8/5 | Customer service 3.4/5 | Customer service 4.1/5 | Customer service 3.4/5 | Customer service 4.5/5 |
Claims handling 3.8/5 | Claims handling 3.6/5 | Claims handling 4.3/5 | Claims handling 3.4/5 | Claims handling 4.7/5 |
Special highlight Accident forgivenessAI-generated from 3950 user reviews | Special highlight Numerous discountsAI-generated from 1809 user reviews | Special highlight Usage-based savingsAI-generated from 499 user reviews | Special highlight Competitive ratesAI-generated from 7522 user reviews | Special highlight Numerous discountsAI-generated from 508 user reviews |
Data in this table has been sourced from Insurify’s users who have indicated they are insured with the listed providers
Allstate
Allstate calls its program Deductible Rewards. When you sign up for the program, Allstate automatically takes $100 off your deductible and an additional $100 off per year that you’re accident-free (up to a maximum of $500).
Liberty Mutual
Liberty Mutual provides a vanishing deductible called a Deductible Fund for collision coverage only. The company offers year-long policies and decreases your collision deductible every year you avoid filing a claim. Liberty Mutual offers the Deductible Fund to all drivers regardless of their driving history.
Nationwide
Nationwide offers a vanishing deductible for both collision and comprehensive coverage. The company lowers the deductible by $100 each year you’re accident-free, with a maximum savings of $500. After an accident, Nationwide automatically gives you a credit of $100 instead of making you start at $0 for the first year.
Progressive
Progressive also offers a vanishing deductible, called the Deductible Savings Bank, for comprehensive and collision deductibles. For every policy period you remain accident- or violation-free, Progressive will reduce your deductible by $50.
Because Progressive’s policy periods last six months, you could see a decrease of $100 per year for either your comprehensive or collision deductible.
Travelers
Travelers offers a Premier Responsible Driver Plan, which includes a vanishing deductible option and other accident forgiveness perks. The company reduces your deductible by $100 for every year you remain accident-free, with a $500 maximum.
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Pros and cons of vanishing deductibles
These are some of the benefits and drawbacks of vanishing deductibles:
Pros
They keep rates low. You may opt for higher deductibles to get a lower monthly insurance premium. With a vanishing deductible, you can have a lower monthly premium and a low or $0 deductible in the event of an accident.
They don’t cost much. Vanishing deductible coverage is usually affordable and can be a valuable add-on when paired with other benefits, like accident forgiveness.
You’ll pay a lower deductible. A lower deductible means you’ll keep more money in your pocket if you need to file a claim.
Cons
They aren’t the best option for drivers who drive infrequently or don’t file any claims. Drivers with this coverage may ultimately pay more than their deductible if they remain claim-free for too long with this coverage.
Your lower deductible applies only as long as the coverage is in effect. When you remove the vanishing deductible coverage, you lose all the deductible credit you’ve built up since the coverage started. Your deductible will revert to the full amount you selected at the start of the policy, and the full deductible is due if you get into an accident.
Your deductible resets after each accident. After each accident, your deductible returns to where it started. You’ll then have to remain accident-free to decrease your deductible again.
Vanishing deductible vs. accident forgiveness
Vanishing deductibles and accident forgiveness are both programs that some insurance companies offer to reward safe driving behavior.
With vanishing deductibles, your insurance company will decrease your deductible by a certain amount each year (typically $100) for each year you remain accident-free. This may only apply until you reach a certain maximum, often $500.
With accident forgiveness, your insurance company won’t raise your rates after your first accident. Some insurers don’t charge for this coverage, while others offer it as an endorsement to a standard auto policy.
Is a vanishing deductible worth it?
Whether a vanishing deductible is right for you depends on how often you file claims for an accident. Accident-prone drivers benefit more from this coverage because they benefit from a low deductible and a cheap monthly premium.
Safe drivers or drivers who spend less time on the road might get less value from this coverage. While your monthly premium and deductible may be low, you’ll be paying for coverage you may never use.
Safe drivers also risk paying more than their deductible without receiving the benefit of any vehicle repairs. Because companies bill for this coverage at the beginning of each policy term, safe drivers could end up paying out their total deductible amount by hanging on to this coverage year over year without filing a claim.
Vanishing deductible FAQs
You can get a vanishing deductible option from insurance companies and car dealerships. Check out the additional information below if you still have questions about vanishing deductibles.
What does a $100 disappearing deductible mean?
A $100 disappearing deductible means your deductible will decrease by $100 each policy term if you remain accident-free.
What is the benefit of a disappearing deductible?
Disappearing deductibles can help keep your monthly premiums lower. You can initially sign up for a higher deductible, saving you money, and then the deductible will decrease over time. So if you’re in an accident, you won’t have to pay as much out of pocket when you file a claim.
How can you qualify for a diminishing deductible program with your insurer?
Eligibility requirements for diminishing deductible programs vary from insurer to insurer. Some insurance companies require a clean driving record, while others only need you to get an auto policy and opt into the coverage. Generally speaking, as long as you pay for the coverage each term, you can benefit from having a vanishing deductible.
How does a vanishing deductible affect your insurance premiums?
It depends on the insurance company. Some companies offer a vanishing deductible program as an add-on to auto policies, while others offer it as part of a package with other coverage options, like a total loss deductible waiver. It’ll typically increase your premiums slightly, but that extra cost can be worth it if you end up needing to file a claim.
How does a disappearing deductible work on a car warranty?
The differences between disappearing deductibles from an insurance company and a dealership’s disappearing deductible depend on the company. With Toyota, for example, the dealership offers a $0 deductible or a $100 vanishing deductible with extended warranties.
If you opted into the disappearing deductible, you’d pay $0 to file a claim and get repairs at the dealership that sold you the warranty or $100 to have your vehicle fixed elsewhere.[3]
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Sources
- International Risk Management Institute. "Disappearing Deductible."
- Insurance Information Institute. "Understanding your insurance deductibles."
- Toyota. "Deductible Options."
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Courtney Washington
Courtney Washington is a Texas A&M University graduate. Her extensive knowledge and background in auto, home, and umbrella policies make her a one-stop shop for insurance advice and information. She loves to help her readers understand their insurance choices so they can make informed decisions about their coverage.
7+ years in content creation and management
5+ years in insurance and personal finance content
Ashley is a seasoned personal finance editor who’s produced a variety of digital content, including insurance, credit cards, mortgages, and consumer lending products.
Featured in