What are the different types of deductibles in insurance?

What are the different types of deductibles in insurance?

There are mainly two types of deductibles: fixed and variable. Fixed deductibles are a set amount, while variable deductibles can change based on the policy.

Can you explain how a fixed deductible works?

Sure! A fixed deductible is a specific dollar amount you must pay out-of-pocket before your insurance coverage kicks in. For example, if you have a $500 deductible, you pay the first $500 of a claim.

What about variable deductibles?

Variable deductibles can change based on factors like the type of claim or the insured value. They may also vary by policyholder's choices.

Which type is more common?

Fixed deductibles are more common in many insurance policies, as they provide clarity on the amount you need to pay before coverage starts.