What is a health insurance deductible?

What is a health insurance deductible?

 What is the total deductible?

The total deductible is the limit deductible the policyholder will be required to pay the claim within a given period. Total deductibles are most likely features of a product liability insurance policy or insurance policy that can result in a large number of claims occurring within a given period.

How the total deductible works

The purpose of the total deductible policy feature is to put a cap on the amount the insured must pay. Manufacturers purchase product liability insurance to protect themselves against claims arising from product damage. This is especially valuable for products that can cause significant damage if improperly manufactured, such as medicines and automobiles, and products that are sold in large quantities, such as toys.


  • The total deductible is typically used for home health insurance policies and below.
  • The total deductible is the deductible for the entire family that must be paid out of pocket before the company pays for services for one family member.
  • The total deductible is usually part of a product liability policy or a home health insurance policy, as well as any other policies that could result in a large number of claims during a specific period.
  • The total deductible policy feature is popular because it places a cap on the amount the assured must pay.

While policyholders may have product liability insurance batch clauses, not all states allow policyholders to treat all claims as part of the same event. If each claim is considered independent, the policyholder must pay a deductible for each claim, even if the deductible is greater than the claim amount. This essentially creates a situation where the policyholder is uninsured.

Example of total deductible

For example, a canning company was notified that some of its products were making consumers sick. The company has a per-accident deductible of $10,000, but it also has a total deductible that specifies it doesn’t have to pay more than the $100,000 deductible in a given year.

Several states where consumers live do not allow multiple claims to be considered part of the same event.

The total number of claims reached 1,000, with each claim valued at $5,000. Without the total deductible, the company would be responsible for the entire claim, which would ultimately have to pay $5 million (5000 claim value x 1000 claim). However, the total deductible limits the company’s total deductible to $100,000.

Total deductible and health insurance

Cumulative deductibles are also used in home health insurance policies. Under the cumulative deductible family health insurance plan, the total family deductible must be paid out of pocket before health insurance begins to pay for health care services incurred by any family member.

For the total deductible, each family member cannot meet the embedded deductible requirement. Monthly premiums for cumulative deductible family health insurance may be lower, but coverage will not take effect until the full family deductible out-of-pocket is paid, which may be much higher than the individual embedded deductibles for each family member.

Special attention items

 In some cases, the total deductible can boost individual health insurance coverage, according to the Georgetown University Center for Medicare Reform. If a family member incurs a significant amount of medical expenses, that individual will complete their deductible faster because the deductible is lower than the family deductible. This can save a family thousands of dollars.

By aamritri

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