What Is an Annual Deductible?

Types of deductibles

Insurers structure deductibles in different ways, and the type can matter as much as the amount.

• Annual deductible: you meet it once per policy year, and it applies across all covered conditions.
• Per-condition deductible: you meet it separately for each condition.
• Lifetime deductible: you meet it once for each condition, and it does not reset.

The premium trade-off

A higher deductible generally lowers your monthly premium, and a lower deductible generally raises it. The right balance depends on how much you could pay at once without stress.

Illustration

With a $500 annual deductible and a covered $2,000 bill, you would pay the first $500. The remaining $1,500 is then eligible for reimbursement at your plan’s rate.

Sources and further reading

This guide explains general industry practice. For the terms that apply to you, rely on the policy documents from each insurer you consider and on the consumer resources published by your state insurance department.