<prompt> Human: I just realized the price difference between a 500 vs 1000 deductibles on my collision coverage is 50 per 6 months. It occurred to me the lower deductible is essentially gambling. I would be wagering 50 to win 450 that I cause an accident in the next 6 months. It seems like it goes against common sense to bet that I get into an accident. Assuming you have emergency savings to cover the higher deductible does it ever make sense to take the lower ones? Isnt insurance supposed to be to protect against catastrophic failure? If 2,500 deductible wouldnt ruin you then why not take it? Surely the insurance company has the house edge.  <response>: Taking a low deductible on car insurance is a risk reduction technique, like any insurance benefits you pay extra for. If you are lower income and the 1000 deductible would be a serious drain on your income, it actually is financially wise to pay a little extra for the lower deductible. You pay a little more to avoid the financial catastrophe you cant handle yes it seems almost counterintuitive, but if you have less money, spending more to get a lower deductible makes a ton of sense.If the 1000 deductible is something that wouldnt be a significant burden, pocket the extra 50 if you want. Its basically a way that you self-insure for that deductible amount. 