Your deductible is one of the critical components of any health, home or car insurance policy, as it represents the amount of personal risk that you as the policyholder will continue to assume after buying the policy. Simply put, the deductible represents the percentage or dollar amount of the costs for a medical procedure, home repair or other incident that you will pay. A lower deductible generally means higher premiums, since it means the company will pay more if you have a valid claim. On the other hand, a higher deductible means you pay less every month but have to use more of your own money if you need repairs or care.
- An insurance deductible is a valuable bit of information for a policy holder to know.
- Deductibles can come in the form of a dollar figure or a percentage.
- A higher deductible can mean increased savings though, if there is a loss, the policy holder may be responsible for the difference.
“Whether you are insuring your car or a home, the role of deductible is essential to be known.”