Vanishing Deductible: Is it legit?
Updated April 28, 2021
Reading time: 3 minutes
Car insurance companies love safe drivers because they cost less money to insure.
Think about it: the fewer accidents you have, the less time and resources your insurance company has to spend on you.
If you’re someone with a clean driving record, you deserve to be rewarded for it. After all, you’re saving your insurance company money—and keeping others safe on the road.
So why wouldn’t you be rewarded for your safe driving? There are lots of ways that auto insurance companies reward safe drivers. Lower premiums and good driving discounts are common rewards for safe driving, but some companies also offer a vanishing deductible. These programs can lower your deductible amount for each year you are accident-free.
A vanishing deductible is a policy where you can reduce your car insurance collision deductible for every year that you remain accident-free. This means that if you ever do get into an accident down the line, you’d pay less than the original deductible on your policy.
A car insurance deductible is standard with almost all car insurance policies. When you have collision coverage on your policy, the deductible is the amount you pay out of pocket for any covered repairs before insurance will pay for damages. Generally speaking, a higher deductible can lead to a lower premium.
To reward safe drivers, some car insurance companies offer a vanishing deductible as an optional feature.
Vanishing deductible programs are best for responsible drivers who rarely find themselves filing an insurance claim. If you have more than one year of safe driving under your belt without any accidents, you should think about a vanishing deductible coverage option. Even though you can never be 100 percent certain that you won’t get in an accident, there’s a good chance you can save on your deductible.
On the other hand, if you have a history of getting into accidents, this type of insurance won’t do you any good. Since many companies require an additional fee for this benefit, you could end up spending more money if you don’t meet the eligibility requirements for the discount.
Whether or not you’re the safest driver out there, comparing quotes is the best way to save money on car insurance premiums. In fact, Insurify can help you save up to 70 percent on car insurance costs by comparing personalized quotes and finding the best discounts for you.
Not all car insurance companies offer a vanishing deductible program, and most require an added fee to participate in the program. Here are some of the leading car insurance companies providing vanishing deductible programs.
Nationwide: Nationwide ’s Vanishing Deductible add-on coverage can knock up to $500 off of your deductible. For each year you are accident-free, you’ll reduce your deductible by $100 for up to five consecutive years.
Allstate: Allstate ’s Deductible Rewards program gives participating drivers a $100 deductible reduction for each year they are accident-free, up to five years.
Erie: Erie offers a Diminishing Deductible program through its ERIE Auto Plus endorsement. Policyholders can shave $100 per year off their deductible for each year they are accident-free, up to $500 off.
The Hartford: The Hartford ’s Disappearing Deductible program reduces your collision deductible amount by $50 for every year you are accident-free, up to $500.
Liberty Mutual: Liberty Mutual ’s Deductible Fund program is a little different from others. Instead of a deduction, Liberty Mutual collects $30 from policyholders and contributes $70 for every year you are accident-free. The money in the fund can then be applied to your deductible. With this arrangement, there’s no maximum savings limit, and it automatically resets when and if you use up your fund.
The bottom line: If you want the chance to lower a high deductible, check that your car insurance company offers a vanishing deductible program. There are other great rewards for safe motorists out there, but each car insurance company varies.
Getting affordable car insurance doesn’t have to be hard. Instead of worrying about your driving history and eligibility requirements for discounts, Insurify’s insurance comparison tool does the work for you. You can compare quotes based on your driving history in minutes so you can find the right coverage at the best price for you.
Data scientists at Insurify analyzed more than 40 million real-time auto insurance rates from our partner providers across the United States to compile the car insurance quotes, statistics, and data visualizations displayed on this page. The car insurance data includes coverage analysis and details on drivers' vehicles, driving records, and demographic information. Quotes for Allstate, Farmers, GEICO, State Farm, and USAA are estimates based on Quadrant Information Service's database of auto insurance rates. With these insights, Insurify is able to offer drivers insight into how companies price their car insurance premiums.
Mandie Kelleher is a freelance content writer for financial services and personal finance. With a background in financial administration, and teaching, she crafts content that deepens her readers' understanding by making complex topics simple. You can learn more about Mandie by visiting her site, mandiekelleher.com.Learn More