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Related to deductibles: Co-Pays


An amount or period which must be deducted before an insurance payout or settlement is calculated.


1. Able to be taken off of one's tax liability. See: Deduction.

2. In insurance, the amount that a policyholder must pay for a claim before the insurance company will make any payments at all. That is, if an insured event happens, the policyholder is responsible for covering damages up to a certain dollar amount, at which point the insurance company begins coverage. Some insurance policies have an annual deductible; that is, if two insured events happen in a given year, the deductible is only applied once. Other policies have a per event deductible; that is, the deductible applies each time a claim is made. Generally, the higher one's deductible is, the less one pays in premiums on the policy.


A deductible is the dollar amount you must pay for healthcare, damage to your property, or any other insurable claim before your insurance company begins to cover the cost of the bill.

For example, if you have a health insurance policy with an annual $300 deductible, you have to spend $300 of your own money before your insurer will pay whatever portion of the rest of the year's bills it has agreed to cover.

However, in some types of policies, the deductible is per event, not per year. Generally speaking, the higher the deductible you agree to pay, the lower your insurance premiums tend to be. However, the deductible for certain coverage is fixed by the insurance provider. That's the case with Original Medicare.

References in periodicals archive ?
Insurance is essential for most every business, but in addition to determining which coverages are necessary, business owners also have to decide whether a lower premium is worth the cost of a higher deductible in the event a claim is made.
And, of course, if your plan options have differences beyond deductibles and copays, there's a whole host of other issues to think about.
Insured has a covered loss to which we have applied the $1,000 deductible. However, the agent is contesting application of the deductible stating only the 72-hour waiting period should apply as a deduction.
Americans with health coverage through their employers aren't the only ones facing higher deductibles. Chattanooga Times Free Press columnist Clint Cooper, citing a 2015 HealthPocket study, wrote on September 23, "The average deductible for a single person enrolled in the ACA's bronze plan--its cheapest--is $5,181, while the average deductible for a family in the same plan is $10,545.
Silver exchange plans were more likely to impose deductibles on in-network specialist visits, but not that much more likely: The percentage of silver exchange plans imposing deductibles on in-network specialist visits in the states studied has dropped to 39 percent this year, from 41 percent in 2014.
Specifically, Kaiser said, less than two-thirds (63 percent) of non-elderly households with incomes above the federal poverty level have sufficient liquid financial assets to cover a midrange annual deductible of $1,200 for an individual or $2,400 for a family.
In summary, the most important advice to help you overcome the challenges of applying deductibles is to pay close attention to the wording of the deductible and coinsurance provisions in the particular policy.
On a home valued at $335,100 in Palm Beach County, with a 2 percent deductible, the homeowner would need to pay $6,702 before repairs could begin.
On some forms, such as the Garage Coverage form, deductibles may apply to only certain perils.
The study results mentioned in the "Cost Reduction Because of Decreased Moral Hazard" section can be influenced by the context in which deductibles are arranged.
Property managers in New Orleans and South Florida now face a major dilemma as a result of sustaining so much damage to their properties and changes to how windstorm deductibles are calculated: They must determine whether the high deductible imposed by insurance companies is an operating expense passed through to tenants or a capital improvement expense paid for out of their own pockets?