A provision that eliminates the deductible under certain circumstances. For example, some auto policies waive the deductible if the other driver is identified and found to be at fault, or if the damage exceeds a certain threshold.
Related Terms
Claim
A formal request made by a policyholder to an insurance company for payment or reimbursement for a covered loss or policy event. Filing a claim triggers the insurer to investigate the loss, assess damages, and determine what amount is payable under the policy.
Deductible
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.
Collision Coverage
Auto insurance that pays for damage to your own vehicle when it collides with another vehicle or object, regardless of fault. Collision coverage is optional but often required by lenders if you have a car loan or lease.