What is the difference between the premium and the deductible?

The premium and the deductible are two separate aspects of an insurance policy. The premium is the amount that an individual pays each month to their insurance provider in exchange for coverage. The deductible is the amount that must be paid in the event of a claim before the insurance provider will begin to cover the costs of damages. For example, if an individual has an auto insurance policy that costs $100 a month, then the premium is $100. If there is an accident and the individual needs to file a claim, the first $500 might be their deductible, meaning that the individual would need to pay for the first $500 of repairs before the insurance company would cover the cost of repairs. In summary, the premium is the amount that is paid to the insurance provider for a policy, and the deductible is the amount that must be paid in the event of a claim. The higher the deductible the lower the premium, so it is important for individuals to consider what the most suitable option is for them when selecting an insurance policy.

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What is the difference between the premium and the deductible?

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