What is the difference between a premium and a deductible?

A deductible is the amount you must pay for a medical service before your health insurance policy will cover the rest. For example, say you have a deductible of $500. If you are injured and the medical bill is only $500, you will pay for it out of pocket. However, the amount you have paid will count towards your deductible for the rest of the year. If you sustain another injury before the year is out, your insurance company will cover those expenses.

A premium is the amount of money you pay in order to maintain your coverage. Premiums are usually paid on a regular basis. In some circumstances, they can be deducted automatically from your paycheck.

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