Written by Q: I have a loan through Chase Auto Finance and I believe they told me I needed to have a $500 deductible – why is that?
AIS Answer: According to Chase Auto Finance your insurance requirements are as follows until you purchase the car outright, or return the vehicle to them.
Liability Coverage
Bodily Injury: $100,000/$300,000
Property Damage: $50,000 (listing Chase as additional insured)
Comprehensive and collision coverage must have a maximum $500 deductible listing Chase as the loss payee and additional insured.
What Chase is essentially asking for (no different than any other bank with collateral) is for you to protect their financial interest, which is the vehicle. Most lenders will require this coverage exactly as it is the only way to insure that in the event of damage their collateral will be “made whole”.
The $500 deductible is just another safeguard. The lower the deductible the easier it would be to cover the amount in case of damage and many insurance companies understand that if you have a lienholder on your vehicle that you have to carry this coverage with a deductible for comp and collision no higher than $500.
If you have any questions about your insurance requirements you should speak to Chase directly, and before you make any changes to your auto insurance policy you need to speak with your insurance company.
most auto finance places require these coverages when you finance a car.