West Virginia Adjusters Practice Exam 2025 - Free Adjuster License Practice Questions and Study Guide

The term "deductible" in insurance refers to the initial amount that the insured must pay out of pocket before the insurer begins to cover costs for a claim. This means that when a policyholder files a claim, they are responsible for paying this specified amount first, after which the insurance company will take over and pay for the remaining eligible costs according to the policy’s terms.

For example, if a person has a deductible of $500 and submits a claim for $2,000, they will need to pay the first $500 themselves. The insurer would then cover the remaining $1,500, assuming all other conditions of the policy are met.

Understanding deductibles is crucial for insured individuals as they impact the overall cost of insurance policies and the amount that must be paid in the event of a loss. It also encourages policyholders to consider the potential costs versus benefits when choosing a plan with a higher or lower deductible.