Deductibles
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Deductibles (pronunciation: /dɪˈdʌktɪbəlz/) are a specific amount of money that an individual must pay out-of-pocket before an insurance company will pay a claim.
Etymology
The term 'deductible' originates from the word 'deduct', which means to subtract or take away. In the context of insurance, it refers to the amount that is subtracted from the total claim amount.
Types of Deductibles
There are two main types of deductibles in insurance:
- Comprehensive Deductible: This type of deductible applies to damage to the insured's property that is not caused by a collision.
- Collision Deductible: This type of deductible applies when the insured's property is damaged as a result of a collision.
Related Terms
- Premium: The amount that must be paid for an insurance policy.
- Co-pay: A fixed amount paid by an insured for covered services.
- Out-of-pocket Maximum: The most you have to pay for covered services in a plan year.
See Also
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