In case of an event covered by the insurance contract, the holder may have to keep a sum: the franchise. The contract specifies the damages for which the insurer applies a deductible and the amount of the deductible (s). How is a franchise set? How to adjust it and in what cases? The Matmut explains the mechanism of the deductibles in auto insurance.
What is a car insurance franchise?
A car insurance deductible is the sum that remains the responsibility of the insured after a disaster and will not, therefore, be reimbursed by the insurer. The goal: to encourage prevention and encourage drivers to drive more cautiously.
In which cases do you pay the car insurance deductible?
It is not refunded if:
- the insured is responsible for a claim,
- the driver responsible for the incident has not been identified, is not insured or is insolvent.
How to pay the auto insurance franchise?
A car insurance franchise can take the form:
- A fixed price to be paid in euros,
- A percentage of the amount of compensation,
From a "fixed-percentage price" combination, for example: 15% of the allowance with a ceiling of 300 euros.
Auto insurance deductible: how are the amounts fixed?
The amount of the automobile deductible varies according to the type of claims: it will not be the same if it is a break of ice or the fire of a car. The insurance contract must specify the type of deductible (see below) and how it is calculated.
Franchises allow the insurer not to compensate for small damages. As a result, their existence and amount may have an impact on the insurer's determination of the premium for the collateral concerned. However, to the extent that they constitute a limitation of the guarantees, it is strongly recommended to compare the different contracts before any subscription. If in doubt, do not hesitate to ask for additional information.
What are the different types of auto insurance franchise?
Depending on the contract, the car insurance franchise can take many forms.
Absolute franchise
This is the most common type of franchise. This is a lump sum or a percentage that will be systematically deducted from the compensation for damages covered, regardless of their amount. An absolute deductible delimits the insurance indemnity since it is only due if the amount of the damages is greater than the amount of the deductible applicable to the claim. More specifically, for a deductible of 200 euros, you will not receive compensation if the loss is estimated at 150 euros. However, if it is 2,000 euros, you will be reimbursed 1,800 euros.
The relative franchise
Also known as a simple franchise, this type of franchise is more rare in insurance contracts. The insurer stipulates that it does not cover damages if their amount is less than a sum fixed in the contract. On the other hand, if the amount of the damage is higher than that of the deductible, it indemnifies them in full, without applying a deduction.