Understanding Insurance Deductibles: What to Do When You Can't Pay

An insurance deductible is the amount of the bill on an accident, repair or medical procedure that you must pay before your insurance company covers the rest of the cost. This amount varies from plan to plan, but generally the higher the deductible, the lower the monthly payment for insurance. This should not be confused with the co-payment, which is the first payment you must make to medical services before the deductible takes effect. Deductibles are applicable to nearly any sort of insurance policy.

Insurance Options

Unfortunately, if you cannot pay your insurance deductible, there is not much you can do to reclaim your insurance. If you do not pay the deductible, the insurance will refuse to cover you for any policy you may have. There are some cases of extenuating circumstances, but these are very rare and insurance companies are not under any legal requirement to cover you if you do meet the deductible payments.

Deductible payments are typically counted as being incurred within the space of one year, from the time you buy the policy to the same date of the next year. This is known as a calendar year deductible. You cannot use co-payments for this purpose--the deductible is a separate, and usually higher, charge. If you want, you can usually switch to a policy that has a deductible based on a percentage of the insurance cost rather than a total amount per coverage or per year.

Supplemental Funds

If you cannot afford your insurance deductible, there are several alternative choices you can choose outside the coverage your policy would have provided. This is especially easy when dealing with health insurance, because there are multiple programs designed especially for those who cannot afford insurance payments or because of certain circumstances cannot currently meet their deductible payment. Look into the Risk Mapping, Assessment, and Planning (MAP) program, Medicaid, Indicare, and any state or local options that may be available to you.

If there are additional circumstances, you can often qualify for certain types of loans to help you get through current problems. Some agencies, such as the Small Business Administration, offer disaster assistance loans for business owners whose property is destroyed during some type of natural event. Similar loans cover a variety of circumstances. If you cannot make a car insurance deductible, you may have difficulty gathering the necessary funds, but there are alternative loans or programs for many other policies.