In a percentage deductible, what does the insured party pay?

In a percentage deductible, the insured party pays a percentage of the total claim cost. This means that when a loss occurs, the deductible is calculated based on the overall cost of the claim rather than being a fixed dollar amount. For example, if the total claim is $10,000 and the deductible is set at 10%, the insured would be responsible for paying $1,000 before the insurance coverage begins to cover the remaining costs.

This structure is commonly found in certain types of insurance policies, particularly those dealing with high-risk situations, such as health or property insurance in disaster-prone areas. It encourages policyholders to be mindful of their claims, as larger losses they incur will also lead to a larger deductible amount. The other options refer to different types of deductibles or coverage situations that do not directly correlate with the percentage deductible model.