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Property insuranceSubject 12 of 19

Deductible

The portion of a covered loss the insured must bear before the insurer's payment is calculated under the policy.

Direct answer

What does Deductible mean?

The portion of a covered loss the insured must bear before the insurer's payment is calculated under the policy.

Exam cue: Apply the policy's actual deductible and check whether a special windstorm or hurricane deductible applies.

What does it look like in a question?

New York example

A covered $10,000 loss subject to a $1,000 deductible may result in a $9,000 payment before other limits or conditions.

Common exam trap

What should you not confuse it with?

A deductible is the insured's share of a covered loss. It is not the maximum amount the policy may pay.

Related property insurance terms

Actual cash valueA loss-settlement measure commonly based on replacement cost less depreciation, subject to the policy language.ExclusionA policy provision that removes specified property, causes of loss, people or situations from coverage.HazardA condition that increases the chance or severity of loss.Liability coverageInsurance protection for covered claims that the insured is legally responsible for bodily injury or property damage to others.PerilAn event or cause of loss, such as fire or theft, addressed by the insurance contract.PremiumThe amount charged for insurance coverage for a stated period.
Sources used2 references with section locators

The curriculum citation confirms exam scope. Definition and rule citations support the explanation itself. Links and locators were checked on August 26, 2026.

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