Your Home Insurance Deductible: How Much Is Too Much?

Home insurance deductibles give you some freedom in selecting the amount you’ll pay on your insurance plan. Deductibles are what you’ll pay first before your insurance kicks in when you file a claim. For example, if your roof needs replacing and the procedure is covered by your policy, you’ll pay your deductible first and the insurance carrier can cover the rest of the costs. What’s important to know is that your deductible is often a flexible component of your plan.

The higher your deductible is, the less the insurance company has to pay out during a claim. For this reason, raising your deductible can help to lower your policy’s premium (which is what you pay for coverage). A lower premium could save you thousands of dollars over the lifetime of your homeownership. However, if your deductible is too high, you may not have the funds available to pay for the repairs or loss out-of-pocket.

What’s more important to you: That your insurance company pays out as much as possible during a claim or that you save more money during the lifetime of your policy?

Deductibles can be as low as $500, or they can be as high as several thousand dollars. The amount you will save on your premium is really dependent on many factors, including what the insurance provider charges. While getting a quote for home insurance, you can compare the options in deductibles to see the specific difference it makes.

What’s important to remember is that your deductible should never be more than you can afford to pay out if a claim occurs. You should have enough funding on hand to cover your deductible, in case you need to file a home insurance claim. Work with your carrier to find the right balance of deductible and premium costs for your situation and your peace of mind.

We’ll help you find the right coverage. Call Ayala Insurance at 602-277-1900 for more information on the home insurance policies we offer.

Which do you believe is better — having a lower deductible, or having a lower premium. Let us know in the comments.