Deductibles

A deductible refers to a fixed amount of money that must be paid by an insured before the insurer begins to pay the claims. In an insurance policy with a deductible, the expenses below the deductible are paid by the insured, whereas the liability of the expenses exceeding the deductible amount is assumed by the insurer. Deductibles are applied in various types of insurance contracts, including health, property, and auto insurance policies. However, deductibles are not applicable for life insurance policies since the death of the insured is the total loss under this type of contract. The insured should take into account the risk exposure and the deductibles together while choosing a cost-effective insurance policy—specifically a health plan—because insurance contracts with higher deductibles are more ...