Definition of Deductibles:
The Meaning of Deductible in Insurance

English Vocabulary Lesson

"Definition of Deductibles: the Meaning of Deductible in Insurance" can provide English learners with an essential understanding of the term "deductible" as it is used in the context of insurance. By learning its meaning, English learners will be able to better understand and discuss insurance policies, as well as interact with insurance companies.

This lesson includes a simple definition, example sentences, and example dialogues to show how the term "deductible" is used in context.

Definition of Deductibles: the Meaning of Deductible in Health Insurance

Definition of "Deductibles"

A deductible is the amount of money you have to pay before your insurance starts to pay for things.
For example, if your car insurance deductible is $500, you have to pay the first $500 of any repair expenses yourself.

After that, your insurance company will cover all or part of the remaining costs, depending on your insurance policy and coverage level.

Deductibles can be set as a fixed amount or as a percentage of the total cost.
For example, if you have an auto insurance policy with a $500 deductible and your repair bill is $1,000, you would pay the first $500 and your insurance company would cover the remaining $500.

If you had a policy with a 10% deductible, you would have to pay 10% of the repair cost ($100). The insurance company would then cover the remaining $900.

Example Sentences with "Deductible"

  • My health insurance has a $500 deductible for hospital stays.
  • You should compare the deductibles of different insurance policies before you buy one.
  • How much is your car insurance deductible?
  • I need to meet my deductible before I can start using my insurance coverage.
  • Paying the deductible is part of my responsibility when filing an insurance claim.
  • If I choose a high deductible plan, my monthly premiums will be lower.
  • My health insurance plan has separate deductibles for different types of services.
  • I'm trying to decide if the cost of the repair is more than my car insurance deductible.
  • My deductible will be reset at the start of each new year.
  • To take advantage of my insurance coverage, I must pay my deductible first.

The Origin of the Word "Deductible"

The word "deductible" comes from the English word "deduct" (take away, decrease).

"Deduct" comes from the Latin word "deducere", which means "to lead away".

The term was first used in relation to taxes, then later adapted for use in the context of insurance

In the context of taxes, it means taking out certain expenses from your income to reduce how much money you have to pay in taxes.

A Dialogue to Show How "deductible" Is Used in Everyday Context

Liam: Unfortunately, I was involved in a minor car accident. While I was parking, I hit the back of another car. Thankfully, I was not injured, but my car sustained some damage. Now I need to file an insurance claim to cover repair costs.

Sue (Liam's insurance agent): I understand. Let's have a look at your policy to see what's covered. Yes, it looks like you have coverage for this type of incident. Please note that your deductible will need to be paid before the claim is processed.

Liam: How much is my deductible?

Sue: Your deductible is $500. Once you've paid that amount, the insurance company will cover up to $2,000 for the repairs.

Liam: Oh no, the damages are $505! But my deductible is $500! This means I'll have to pay for the damages out of my own pocket!

Sue: Well, no worries, the insurance will happily cover the additional $5 for you.

Liam: Wow, that's so generous of them...

Sue: That's why they call it a "deductible"! It's deducted from the total amount you have to pay. 
Liam: Maybe next time I should get a better policy with a lower deductible.

Sue: That's always an option, but make sure to compare the premiums and coverage levels of different policies. It also good idea to learn how to park...

Another Dialogue to Show How "deductible" Is Used in Everyday Context

Nina: I just got a bill from my doctor's office and it looks like they haven't applied my insurance discount yet.

Lance (Nina's health insurance agent): That's strange. Let me take a look at your policy. Okay, it looks like you have a $2,000 deductible for hospital stays. That means you must pay the first $2,000 out of pocket before your insurance kicks in.

Nina: Oh, so that's why the bill isn't lower. I didn't realize my deductible was so high.

Lance: Yes, it's important to understand your deductible and coverage limits before you receive medical services.

Nina: I actually think I should have checked it before signing up for the policy. But that's in the past. Do you think I can switch to a different plan with a lower deductible?

Lance: Of course! Let's take a look at what other plans are available. We have one with a $500 deductible that might be more suitable for your needs.

Nina: And how much would that cost?

Lance: The monthly premium would be higher by about $20, but you would have a lower deductible.

Nina: That sounds like a great deal! Let's switch to that plan then.

Lance: Great! Step one is done, now let's start working on the paperwork. 

Nina: Will this help cover my current bill?

Lance: Retroactive claims are usually not accepted, so it won't lower your current bill amount. However, the new policy will start right away and you'll have a lower deductible for future medical bills.

Nina: I hope I won't have any soon!


Learn Additional Insurance Terms (with Examples and Explanations)
:

- Definition of Insurance Premiums (Simple and Illustrated)

- An Easy-to-Understand Definition of Beneficiary, Example Sentences and Dialogues

- Definition of Deductibles: The Meaning of Deductible in Insurance

- Life Insurance Term Meaning


Disclaimer: This English vocabulary lesson is for informational and educational purposes only. It is not intended to be a substitute for professional advice.