The deductible is a entity of insurance law and is defined as the insured ‘s participation in the loss caused by the loss and its purpose is for the insured to do everything in his power to prevent the loss from occurring.
Generally, the amount of the deductible can be agreed with the insurer under the following rule: The higher the premium amount, the lower the deductible amount, and the lower the premium amount, the higher the deductible amount. The simplest application of this rule consists of establishing a minimum premium, with a determined deductible; and a higher premium, without any deductible.
In countries with a high level of insurance coverage (either by local custom or by government imposition of compulsory insurance), it is common that there is no deductible, since losses, if any, are spread over a large population of policyholders.
Car and property insurance
In a typical automobile insurance policy, the deductible applies to claims arising from damage to or loss of the insured’s own vehicle, regardless of whether the damage or loss is due to accidents for which the owner is responsible, or to vandalism or theft.Depending on the insurance policy, the deductible may vary depending on the type of expenses incurred that give rise to an insurance claim.
Industrial and commercial insurance
In today’s insurance market, traditional companies are reducing the risk of claims, resulting in higher deductibles, which put more pressure on policyholders than on the insurer.The industrial risk deductible is usually expressed as a percentage of the claim, often, but not always, with a minimum and maximum amount.It is similar to coinsurance, in which the company pays a certain percentage of the claim combined with minimum and maximum benefit thresholds.
Health and travel insurance
Most health insurance policies and some travel insurance policies also include an excess.The type of health insurance excess can also vary, both individual and family amounts.The type of health insurance excess can also vary, both individual and family amounts.] The type of health insurance excess can also vary.
Due to the nature of medical treatment, the insured often faces multiple medical expenses spread over several days for a single illness or injury. For this reason, health insurance deductibles are usually charged on an ongoing basis (e.g., annually) rather than on a per-visit basis.
