Those who have to deal with insurance companies have heard the word "franchise" many times. Many are puzzled when an insurance agent or manager in the office offers to issue this very deductible when signing an insurance contract. What is it? Is this a useful feature or some clever trick?
Insurance deductible
An insurance deductible is an amount agreed in advance in insurance contracts that is not reimbursed by the insurance company in the event of an insured event. Simply put, this is the amount that your insurer will not pay you when calculating.
Let's say you insured your car and prescribed a deductible of 10 thousand rubles. If you damage it slightly and the repair will cost, say, 5 thousand, then you will carry out it yourself, without contacting the insurance company. If your loss is 100 thousand rubles, the insurer, minus the deductible, will pay you 90 thousand.
It would seem, what then is the insurance deductible for? In fact, it is beneficial for both the client and the insurance company itself.
First, by agreeing to a franchise, the client receives a significant discount on the insurance policy. The amount saved in this way can be comparable to the size of the deductible, and it can well be set aside for minor repairs.
Secondly, you do not need to waste your time contacting the insurance company about minor repairs. The absence of the need to fill out a bunch of papers can also be attributed to the pluses.
The benefits for the insurance company are clear. This is mainly the release of employees from accompanying minor insured events, the registration of which requires no less resources than serious accidents.
Abroad, the franchise is prescribed in most insurance contracts, but in Russia it is not yet popular enough.
Conditional and unconditional deductible
A conditional deductible applies if the damage is less than the deductible. For example, if you insured your car for 1 million rubles and established a deductible in the amount of 10 thousand rubles, then in case of damage of 9 thousand you will not receive anything, and in case of damage of 10 thousand 100 rubles you will receive the entire amount.
In practice, clients are trying by hook or by crook to increase the amount of damage in order to get insurance, so the conditional deductible in our country is not very widespread.
The unconditional deductible is deducted from the amount of the insurance indemnity in all cases. In the example with the same car, if the damage is 9 thousand, you will also receive nothing, if the damage is 10 thousand 100 rubles, you will receive 100 rubles, and if the damage is 100 thousand, you will receive 90 thousand rubles.
