What Is a Deductible?


If you are new to the world of insurance coverage, then you are probably wondering what a deductible is… and rightly so.

In simple terms, a deductible is the amount of money that you have to pay your insurance company before you are eligible to make a claim. It’s as simple as that. (Okay, maybe it’s not as simple as that, but for the sake of simplicity let’s assume that it is!)

Here’s a little known fact: Your deductible is not set in stone. In other words, you have complete control over it. But here’s another little known fact that is often overlooked: Your deductible has a direct effect on your monthly insurance premiums. Yep, you read that right!

If you want to save money each month, then raising your deductible to lower your insurance premiums is a perfectly viable option. Likewise, if you want to pay more money each month… wait, what?! Well, you get the idea. ;)

It comes without saying, however, that raising your deductible should ONLY be done if you can afford said deductible in the event of you needing to make a claim. Do we really need to go over what happens if you can’t afford it?

What we recommend is this: Always have some money aside to cover your deductible should an emergency befall you. Being careful has never hurt anyone, after all, and prevention truly is key when it comes to insurance coverage.

Now that you know what a deductible is, it’s time to figure out how high (or low) you want yours to be. Unfortunately, there is no “one-size-fits-all” answer to this question because it depends on several factors, among them your budget and the type of insurance policy that you are planning on purchasing. We encourage you to bring up this topic with your insurance broker if you are still unsure of what to do.

Good luck!


Professional Liability Insurance/PLI

(Errors and Omissions Insurance)

  • Flawed professional advice and services that may have resulted in financial loss to the customer or client.
  • Protects professional individuals or companies from responsibility of the full cost of defending against a negligence claim and damages awarded in such a civil lawsuit.
    • Professional liability insurance covers the costs of judgments, settlements and legal defense.
    • Damages paid under a professional liability policy are typically financial rather than physical.