The amount you must pay out of pocket before your insurance coverage kicks in. A higher deductible generally means a lower premium. For example, if you have a $1,000 deductible and file a $5,000 claim, you pay $1,000 and your insurer pays $4,000.
Related Terms
Coinsurance
The percentage of costs you share with your insurer after meeting your deductible. For example, with 80/20 coinsurance, the insurer pays 80% of covered expenses and you pay 20% until you reach your out-of-pocket maximum.
Copay
A fixed dollar amount you pay for a covered health care service at the time you receive it. For example, you might pay a $30 copay for a doctor visit regardless of the total bill. Copays do not usually count toward your deductible but often count toward your out-of-pocket maximum.
Premium
The amount you pay to an insurance company to maintain your coverage, typically billed monthly, quarterly, or annually. Premiums are determined by factors such as risk level, coverage amount, deductible, location, and claims history.