What does a deductible of 18,000 mean?

Generally, a deductible of $18,000 refers to the annual deductible, that is, the insured person in the insurance period, after deducting the social security has been reimbursed part of the accumulated expenses incurred within the scope of coverage must exceed 18,000 yuan, the insurance company will be reimbursed.

The deductible is what the insurance company and the insured agreed upon when they took out the policy. If the loss is within the stipulated amount, it will be borne by the insured, and if it exceeds the stipulated amount, the insurance company will pay out according to the agreed percentage of coverage.

Of course, in addition to the minimum reimbursement threshold of a deductible, there is also a maximum reimbursement benefit. This means that if the insurer reimburses more than the agreed limit during the period of insurance, it will not reimburse the insured for expenses incurred within the scope of coverage thereafter.

Deductible, as the name suggests, is the amount of the deductible. It refers to the amount agreed upon in advance by the insurer and the insured that the insured will bear the loss and the insurer will not be responsible for compensating the loss if the loss is within the specified amount. Because deductibles can eliminate many small claims, the cost of loss adjustments is greatly reduced, thus reducing the operating costs of the insurance company, while reducing the premiums to be paid by the insured. All deductibles are widely used in property, health and automobile insurance.

The deductible is the amount of loss that the insured has to bear on his or her own before the insurer pays out under the terms of the policy. Deductibles come in the following forms:

Absolute Deductible:

Absolute Deductible means that the insured is responsible for a certain amount of loss before the insurer pays. For example, if the contract states that the absolute deductible is $200, the insurer will not pay for losses under $200. If the loss exceeds $200, the insurer pays for the excess. Generally, this deductible is applied to each loss.

Absolute Deductible Calculation Formula: Insurance Claim Amount = (Total Medical Expenses - Deductible) x Benefit Percentage

Total Deductible:

Total Deductible. This is the sum of all the losses that are covered by the insurance during the period of insurance. If the total loss is less than the total deductible, the insurer will not pay anything. Once the total loss exceeds the aggregate deductible, the insurer pays for all excess losses. A calendar year aggregate deductible is often used in health insurance, where all eligible medical expenses for the calendar year are totaled together, and once the total exceeds a certain amount, the insurer is contractually obligated to pay health insurance benefits.

Relative Deductible:

This is a type of deductible often used in marine transportation insurance, where the deductible is expressed as a percentage or amount. If the loss is less than the specified percentage or amount, the insurer will not be liable to pay compensation, but when the loss is higher than the specified percentage or amount, the insurer will pay compensation for the entire loss. The reason why the marine transportation insurance use relative deductible is because the shipper can expect due to bad weather, the ship continues to sail and cargo often move at least some small losses, but also because the property is occupied by the carrier, it does not have the incentive to exaggerate the loss.