Deductible
The first slice of every claim, borne by the insured.
Definition
A fixed amount deducted from every claim payment. It removes the attritional small losses that cost more to handle than to pay, and it is the single most effective lever on premium after the clause level. A deductible applies per event or per conveyance depending on the wording — which matters when one incident damages several consignments.
Why it decides money
Raising the deductible is the honest way to reduce premium, because it does not change what perils are covered. Reducing the clause level does.
Related terms
- Franchise
- A threshold, not a deduction — once you exceed it, the whole loss is paid.
- Minimum premium
- The floor under any single premium, whatever the rate produces.
More in value and premium
InsuranceScanner is an insurance intermediary, not an insurer — see the Terms for our role. Nothing here is a personal recommendation that a particular cover, sum insured or deductible is suitable for you. Where anything on this page conflicts with the certificate, policy schedule or wording issued by an insurer, that document governs.