Anonymous
Anonymous asked in Cars & TransportationInsurance & Registration · 2 months ago

What's the difference between premium, coverage and deductible in insurance?

11 Answers

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  • Anonymous
    1 month ago

    Deductible is the amount you pay out of your pocket FIRST BEFORE the insurance chips in to pay the rest.

  • 1 month ago

    You got quite a few wild guesses amongst the answers.  I'll help you out in layman's terms.

    Premium is what it costs you to buy the coverage.  For example, it costs me $900 a year to buy the minimum coverage I need to legally drive.  If I want to include Collision and Comprehensive coverage, it costs me $1500 a year.

    Coverage is what (and how much) your policy will compensate you for if loss or damage happens.  Comprehensive coverage will cover my vehicle against fire, theft, vandalism, hail, windstorm and flood, but it won't cover collision damage.  

    The deductible is the amount your policy will not pay if loss or damage happens.  If a tree falls on my car causing $2000 in damage, and my deductible is $500, my policy pays $1500.  Insurance companies don't care who pays the deductible, as long as it isn't them.

  • 1 month ago

    About $200 a month.

  • Anonymous
    1 month ago

    Premium: Your payment to keep coverage. Can be monthly, quarterly, semi annual, or annual. Usually a break if paid annually.

    Coverage: How much your claims are covered. If $15,000  for uninsured motorist,. it pays your damage/medical to $15k if other guy's fault and he's not insured. 15K isn't Much, these days.

    Deductible: How much out of pocket  you agree to pay when filing a claim. Note, a claim might be fully covered  Before the deductible due. They usually give you some time.

    Can get coverage with no deductible, it costs more  .I had 100% accessory coverage on my Harley, . no deductible, with Progressive,  once.

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  • May
    Lv 6
    1 month ago

    Duh...........................

  • 2 months ago

    Premium is what you pay to have insurance.  You pay it even if you end up not using the insurance.

    Deductible is what you if you use the insurance, but don't pay if you don't use the insurance.

    Coverage is what the insurance company can potentially pay (or pay for) if the need or situation arises.

  • Kaz
    Lv 7
    2 months ago

    Premium:  The amount you pay for coverage.

    Coverage:  The type and amount of coverage you select (full coverage or just                      bare minimum liability).                     

    Deductible:  The amount you have to pay if you file a claim.

  • Scott
    Lv 7
    2 months ago

    Premiums are the amount you pay for insurance. Coverage is what the insurance policy will pay for. Deductible is the amount you must pay of any collision or comprehensive claim before the insurance will pay anything at all.

  • Anonymous
    2 months ago

    "premium" -- what one pays for an insurance policy

    "coverage" -- what losses an insurance policy financially protects against

    "deductible" -- a preset amount of loss one must pay before insurance pays

  • Anonymous
    2 months ago

    premium is how much you pay per year. deductible is the amount you pay if you get in a wreck. 

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