Deductible
The amount of loss paid by the policyholder before the insurance company will begin paying for a covered event. For example, if you have a $1,000 deductible and you have been in an accident which caused $5,000 worth of damage, you must pay the first $1,000 and the insurance company will pay the other $4,000. A deductible is typically either a specific dollar amount or a percentage of the claim amount.
