Deductible, excess, co-insurance - If you read the small print, you will come across these terms in health insurance contracts. It is a good idea to know the meaning of these terms before you choose a plan.

What are deductibles?


The deductible is the amount that a policyholder must pay before the insurance company pays. In other words, the insurance company is liable to pay the claim amount only if it exceeds the deductible.

If your policy's deductible is Rs 30,000 and the insured's loss is Rs 40,000, then the insurance company will have to pay only Rs 10,000. However, if the claim amount is less than the deductible, the insurer is not liable to pay any amount. For policies with a high deductible, the premium is lower, while for policies with a low deductible, the premium is higher.

Significance of deductibles in health insurance

Deductibles prevent people from making insignificant claims or using unnecessary treatment and hospitalisation just because they have insurance cover.

Loading full article...