What do you call the portion of a loss that the insured has to pay out of pocket before the insurance coverage kicks in?

The portion of a loss that the insured is required to pay out of pocket before the insurance coverage begins is known as the deductible. This is a predetermined amount that must be met for the insurance company to cover the remaining costs associated with a loss or claim. The purpose of the deductible is to encourage policyholders to take care in managing risks since they will share in the financial responsibility of their claims.

When a loss occurs, the insured will pay the deductible first, which can help to reduce the insurer's overall expenses and keep premiums lower for all policyholders. Deductibles vary in amount and can differ based on the type of insurance policy or specific coverage options selected by the insured. Understanding how deductibles work is crucial for managing both insurance costs and overall financial planning.

The other terms mentioned refer to different concepts in insurance. Premiums are the amount paid for insurance coverage, copayments are fixed amounts the insured pays for certain services, and exclusions are specific conditions or circumstances not covered by the insurance policy.