Coverage & terms
Deductible
A deductible is the amount the contract holder pays toward a covered repair before the contract pays the rest. In F&I products the amount matters less than the structure: a per-visit deductible is charged once per shop visit however many covered repairs are performed, while a per-repair deductible is charged for each covered failure.
Also called: Contract deductible, Per-visit deductible, Per-repair deductible, Disappearing deductible
Per visit versus per repair
This distinction is the one that decides what a customer actually pays. A vehicle in the shop with three unrelated covered failures incurs one deductible under a per-visit contract and three under a per-repair contract. At a two hundred dollar deductible, that is a four hundred dollar difference on a single visit.
Per-visit is clearly more favorable to the customer, and contracts do not always make the distinction obvious. Two contracts advertising the same deductible amount can produce very different bills, and the language to look for specifies per visit, per occurrence, or per repair.
How the amount interacts with price
A higher deductible lowers the contract price and shifts risk back to the customer at claim time. That trade is reasonable when the customer understands it and can absorb the amount, and unreasonable when a low price was achieved by raising a deductible the customer was never told about.
A zero deductible contract removes the friction entirely, which has a real behavioral effect: customers use coverage they have already paid for rather than deferring a repair to avoid an out-of-pocket cost.
Disappearing deductibles
Some contracts waive the deductible when the repair is performed at the selling dealership. This benefits the customer, who pays nothing, and the dealership, which retains the service work, so it is a genuine alignment rather than a gimmick.
The condition is what to confirm. A waiver that applies only at one location can be worth little to a customer who moves or travels, and the contract will say which repair facilities qualify.
Key points
- Per-visit is charged once per shop visit; per-repair is charged for each covered failure.
- The structure can matter more than the amount on a multi-repair visit.
- A higher deductible lowers the contract price by shifting risk to claim time.
- Zero-deductible contracts remove the friction that causes deferred repairs.
- Disappearing deductibles waive the amount at qualifying repair facilities, commonly the selling dealer.
Related terms
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Deductible: common questions
What is the difference between a per-visit and per-repair deductible?
A per-visit deductible is charged once per shop visit no matter how many covered repairs are performed. A per-repair deductible is charged separately for each covered failure, which can multiply the cost on a single visit.
Is a zero deductible worth paying more for?
It depends on the price difference and how the customer behaves. A zero deductible removes the out-of-pocket friction that causes some owners to defer repairs, which has value beyond the arithmetic.
What is a disappearing deductible?
A provision waiving the deductible when the repair is performed at a qualifying facility, commonly the selling dealership. The qualifying-facility condition is the part worth confirming.
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