Talk:Deductible

Untitled
why should a deductible be "met" before benefits can start. then why do we pay premiums.

Deductible / Excess
These are different, not the same at all. In commercial insurance contracts millions of dollars have been lost due to this confusion.

Excess The amount or proportion of some or all losses arising under an insurance or reinsurance contract that is the insured or reassured must bear. If the loss is less than the amount of the excess then the insured/reassured must meet the cost of it (unless there is other insurance in place to cover the excess).

Excesses may either be compulsory or voluntary. An insured which accepts an increased excess in the form of a voluntary excess will receive a reduction in premium.

Deductible The amount that is deducted from some or all claims arising under an insurance or reinsurance contract. The practical effect is the same as an excess: the insured or reassured must bear a proportion of the relevant loss. If that loss is less than the amount of deductible/excess then the insured or reassured must bear all of the loss (unless there is other insurance in place to cover the deductible).

An increase in deductible should result in a reduction in premium.

Effect So if you have $1000 of insurance cover with a $50 excess and have a loss of $2000 then you are responsible for paying the first $50 and insurers will pay the next $1000.

If you have $1000 of insurance cover with a $50 deductible and have a loss of $2000 then the first $50 is covered by insurers but not paid: insurers will pay the next $950.

However, the effect of both Excess/ deductible is same when the claim amount is less than the insurane coverage amount. taking the above example, if the loss amount is $1000, in that case for both excess as well as deductible, the claim amount to be paid will be $950. —Preceding unsigned comment added by 115.242.120.43 (talk) 18:06, 22 August 2010 (UTC)

Based on comments in this talk section and information from insurance company FAQs, I've updated the section for excess vs deductible. Rshrinivas (talk) 12:47, 9 July 2012 (UTC)

Excess in Loss-Sensitive Insurance
In loss-sensitive insurance, 'excess' can actually refer to the portion of the loss that is above the insured's deductible or retention; it's the responsibility of the insurer. Perhaps a separate article on excess should be created. Anerij 23:54, 2 January 2007 (UTC)

Thanks. Clarification now provided in the section on 'excess' Rshrinivas (talk) 12:44, 9 July 2012 (UTC)

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BetacommandBot 11:25, 6 July 2007 (UTC)

Appearance Allowance and Deductibles
I propose to add in appearance allowances under the automobile deductible section. They can alter the out of pocket expenses and eventually can be added as a link to its own wiki link. Brittanybriody (talk) 23:11, 5 October 2019 (UTC)