Raise the Deductible? The Break-Even
Does a higher deductible pay for itself, and how often can you claim before it does not? Every piece below can be linked to, so it opens in a window on your reader's screen, current as of the record. No form to fill in.
2026 law · Reviewed September 7, 2026 · The full page, with methodology and sources · the terms · All tools
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The two deductibles, the premium at each, the claims you expect, your emergency savings, and the years in; the break-even claim rate, the expected saving, the position with none, one, and two claims, and the affordability check out. In a frame it carries no cookies, no tracking, and a visible link back to the methodology. Your site has to allow frames; most do. The link that opens it in a small window is on the professionals page.
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- In plain words.
- A higher deductible lowers the premium every year and costs you more only when you file a claim. The tool takes the two deductibles and the premium at each, works out the saving per year and the extra per claim, and divides one by the other. That gives the break-even, read as one claim every so many years. It then shows where you would stand after the years you choose with no claims, one, and two, and checks whether the higher deductible could be paid from your emergency savings.
- Why it matters.
- Deductibles are usually left where the policy was first written. A few minutes with the premiums at two levels turns a default into a choice, and the choice is often worth a few hundred dollars a year.
- An example.
- Raising a deductible from $1,000 to $2,500 cuts the premium from $2,400 to $2,100. That is $300 saved a year against $1,500 more on each claim, so the break-even is one claim every 5 years. At one claim in ten years, you come out about $150 a year ahead.
- Where it stops.
- The claim rate is a guess, and it decides the answer. The tool does not model premium increases or non-renewal after a claim, which favor the higher deductible, or the chance of two claims in one bad year. Whether the higher deductible could be paid tomorrow matters more than any of the arithmetic.
The facts
Six quotable sentences on raising a deductible.
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- Raising a deductible trades a certain saving for an uncertain cost. The premium falls every year whether or not you claim. The extra out of pocket is paid only when a claim comes, and only then.
- The break-even is the claim rate at which the two match: the yearly saving divided by the extra per claim, read as one claim every so many years. Claim less often than that and the higher deductible wins.
- Example: raising a deductible from $1,000 to $2,500 cuts the premium from $2,400 to $2,100, a saving of $300 a year against $1,500 more on each claim. The break-even is one claim every 5 years. At one claim in ten years, the expected saving is $150 a year.
- Over 10 years the same choice leaves you $3,000 ahead with no claims, $1,500 ahead after one, and $0 after two.
- Small claims cost more than their amount. Many insurers raise the premium after a claim or decline to renew after two, so a higher deductible that keeps small claims off the record is worth more than the arithmetic shows.
- The number that decides it is not the break-even. It is whether the higher deductible could be paid tomorrow, from savings, without borrowing. If it could not, the lower deductible is the right one whatever the premiums say.
By how often you claim
How the expected saving falls as claims come more often.
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| Claims expected | Premium saved per year | Expected extra out of pocket per year | Expected saving per year | Expected saving over 10 years |
|---|---|---|---|---|
| 0 in 10 years | $300 | $0 | $300 | $3,000 |
| 1 in 10 years | $300 | $150 | $150 | $1,500 |
| 2 in 10 years | $300 | $300 | $0 | $0 |
| 3 in 10 years | $300 | $450 | -$150 | -$1,500 |
| 4 in 10 years | $300 | $600 | -$300 | -$3,000 |
Cite and link.
The clean address, a citation generated from the record so it can never carry a stale review date, and an address for every section so you can point a reader at the exact table or method.
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- Link
- https://consideratecapital.com/tools/raise-the-deductible
- Citation
- Considerate Capital, "Raise the Deductible? The Break-Even," reviewed September 7, 2026, https://consideratecapital.com/tools/raise-the-deductible.
Link to a section
- The calculator https://consideratecapital.com/tools/raise-the-deductible#calculator
- The facts https://consideratecapital.com/tools/raise-the-deductible#facts
- By how often you claim https://consideratecapital.com/tools/raise-the-deductible#key-numbers
- How the break-even works https://consideratecapital.com/tools/raise-the-deductible#how-it-works
- Methodology https://consideratecapital.com/tools/raise-the-deductible#methodology
- Revision history https://consideratecapital.com/tools/raise-the-deductible#revision-history
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