What is the difference between a deductible and premium?

A premium is the amount you pay regularly (monthly or annually) to maintain your insurance coverage, regardless of whether you file any claims. It's essentially the cost of having the policy active. A deductible is the amount you must pay out of pocket when you actually file a claim before your insurance kicks in and covers the rest. For example, if you have a $1,000 deductible and file a $5,000 claim, you pay the first $1,000 and insurance covers the remaining $4,000. Generally, choosing a higher deductible lowers your premium, since you're agreeing to take on more financial responsibility if something goes wrong.