Glossary / Deductible
Restaurant Insurance Glossary
Deductible
Quick Answer
The deductible is the amount you must pay out-of-pocket before your insurance coverage begins paying for a covered loss.
Deductible Comparison Calculator
Compare your current deductible against a higher option using your own numbers.
What You Need to Know
If you have a $2,500 deductible and suffer $10,000 in fire damage, you pay the first $2,500 and insurance covers the remaining $7,500. Higher deductibles mean lower premiums but more out-of-pocket costs when claims occur.
Why It Matters for Restaurant Owners
Choose deductibles you can comfortably afford from cash reserves without disrupting operations. Many restaurants opt for $1,000–$5,000 deductibles to balance premium savings with manageable out-of-pocket risk.
- Property coverage: consider a higher deductible — losses are less frequent but larger.
- Liability coverage: consider a lower deductible — claims are more frequent but less predictable.
- Flood or earthquake coverage: often uses percentage-based deductibles (2–5% of coverage) that run much higher than a flat dollar amount.
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