Understanding the premium and deductible
In a fictional insurance scenario, the policyholder pays a recurring premium and has a deductible that applies to a covered claim. Which distinction is correct?
A
The premium maintains coverage; the deductible is the applicable amount the policyholder pays toward a covered loss before the insurer’s payment under the stated terms.
B
Paying a premium makes every possible loss fully reimbursable with no conditions.
C
The deductible is a guaranteed investment return.
D
A premium is paid only after every claim has already been settled.
Question Leaderboard
Not enough data yet to show leaderboard.