Deductible

Definition

  • The specified amount of out-of-pocket expenses the insured must pay before an insurance company will pay any expenses. In most insurance policies, there exists a relationship between the size of the deductible and the cost of insurance premiums. Generally, one will have a high deductible with low premiums, a low deductible with high premiums, or something in between.

Synonyms
cost to initiate coverage, amount, allowable, sum of money, clause

Related Terms and Acronyms

  • First Dollar Coverage Definition,
    • Insurance coverage that does not require the insured to pay a deductible.
  • High Deductible Health Plan (HDHP) Acronym,
    • Health plans with high deductibles and low premiums.
  • Hurricane Deductible Definition,
    • The payment a policyholder must make to their insurance company before receiving benefits after a hurricane.
  • Out-of-Pocket Limit Definition,
    • A cap on the amount of costs a policyholder will ever need to pay with their own money without receiving benefits.
  • Policy Declarations Definition,
    • The section of the insurance policy that declares the specifics of the insurance policy including premiums, named perils, and policy limits, amongst others.
  • Stop Loss Insurance Definition,
    • A low premium, high deductible insurance policy with an upper limit on coverage.
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