The insurance industry has some confusing rules, and a deductible is part of them. A deductible is an amount you are liable to pay when you file an insurance claim before your health insurance starts to pay. Understanding how a deductible works can help you know how much to pay.
How Does A Deductible Work?
Deductible amounts vary from one insurance policy to another. For example, if your plan’s deductible is $1,500, and your loss or damage is valued at $4,000, your insurance company will cover $2500. Remember that an insurance policy with a lower deductible often has a higher monthly premium, while an insurance policy with a higher deductible generally has a lower monthly premium.
What Will Happen If My Insurance Claim Is Less Than My Deductible?
Your insurance will not cover the claim if your deductible is $1,000, but your claim only costs $600. In fact, it’s best to foot the bill yourself and not to file a claim. Consult with your agent before deciding.
Does Every Insurance Claim Have A Deductible?
Deductibles typically apply to comprehensive and collision coverage as well as property damage. They do not apply to bodily injury liability claims against third parties. So your insurance may not cover all your medical expenses if a guest is injured on your property.