Insurance Word of the Day
Deductible
A deductible is the amount of money you need to pay out-of-pocket for an insurance claim before your insurance coverage kicks in. Once you’ve met your deductible, your insurer will start paying for covered expenses.
EXAMPLE
Let’s say you have an auto insurance policy with a $500 deductible. One day, you get into an accident, and the total cost to repair your car is $2,000. You would pay the first $500 of the repair cost (your deductible), and then your insurance company would cover the remaining $1,500.
In essence, the deductible is the amount you’re responsible for before your insurance kicks in to cover the rest.
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