People always found "Deductible" in their insurance policy. What is deductible? Deductible is an amount the insured must pay over claim before the insurance company pay the claim. Deductible can be seen as out-of-pocket expenses. Out of pocket expenses means direct cash out that could be reimbursed later. The simple way to understand deductible is through this example, let's say your deductible is $500 and your total expenses (claim) is $1500. You have to pay your $500 deductible and your insurer will pay $1000. However, if your expenses was $500, you would have to pay the entire expenses and your insurance company would pay nothing. Deductible often used to avoid a large number of claims, so the consumer could reasonably expect the cost. Insurance company restricting its coverage significantly enough to incur large costs. Because of that, the insurance company expects to pay out smaller amounts less frequently, so they can have much higher savings. Insurance premiums are typically cheaper while involving higher deductibles.

Deductibles usually provided as clauses in an insurance policy to determine how much insurance-covered expense is borne by the policyholder. Deductibles normally quoted as a fixed amount. Depending on the policy, deductible may apply per covered accident, or per year. As for health insurance, which is not easy to delimit, typically applied per year. There are several deductible reimbursement programs that provide reimbursement for automobile, home or health insurance claims. In health care financing, deductibles or out of pocket costs are typically high when it comes to prescription drugs especially in the United States. Before taking a health care plan, it is important to examine the out of pocket costs whether it's high or low.