The term "all causes deductible" refers to a specific provision in an insurance policy that outlines the amount of money an insured individual or entity must pay out of their own pocket before their insurance coverage kicks in for any covered claim. It is commonly used in property insurance, including homeowner's insurance, commercial property insurance, and auto insurance.
In the context of property insurance, an all causes deductible applies to damage or loss caused by any peril covered under the policy. This means that regardless of the specific event causing the damage, whether it be fire, vandalism, natural disaster, or theft, the insured must meet the deductible before being eligible for insurance benefits.
The amount assigned to an all causes deductible can vary and is typically specified within the insurance policy. It is usually a fixed dollar amount, such as $1,000 or $5,000, but can also be expressed as a percentage of the insured value or a percentage of the claim amount.
The purpose of an all causes deductible is to ensure that insured individuals have a financial stake in their property's protection and maintenance. By requiring a deductible, insurance companies can share the risk of potential losses with policyholders, as individuals are responsible for a certain portion of the cost before receiving reimbursement.
It is important for policyholders to fully understand the terms of their policy, including the all causes deductible, to properly manage their insurance coverage and effectively plan for any potential claims.
