Deductibles are the amount of money that you have to pay toward a loss, according to the terms of your policy, before your insurance policy kicks in and pays your claim.
The higher your deductible is, the more money that you save on your premium. In today’s day and age, most insurance companies will recommend that you have a deductible of at least $500.00.
If you are in a position to be able to afford more of a deductible, raising your deductible to $1,000.00 can save you as much as 25% off the cost of your premium.
One important fact to keep in mind, when buying your homeowner’s insurance, is that if you live in an area that is prone to disasters, your policy may include separate deductibles for different types of disasters.
Some good examples of what we mean is that if you live on the east coast, you may well have a separate deductible for windstorm damage. If you live in an area known to have earthquakes, you’ll have an earthquake policy with its own deductible and if you happen to live in an area known for hailstorms, you will likely have a separate deductible for hailstorm damage.
As always, its best to consult your independent insurance agent, to get all of the facts and to learn about all of your options.