When you are looking for the right homeowners’ insurance policy to purchase to protect your business, you need to understand some of the basics of insurance coverage. You may initially be confused about insurance premiums and deductibles, so it is important to take time to do this. When you better understand deductibles and the ones you can afford, you will choose the best policy for your budget and your coverage needs. These are a few things our public insurance claims adjuster in South Florida about homeowners’ insurance deductibles.
A homeowners’ insurance deductible is the out-of-pocket amount that you are responsible for paying before your coverage kicks in. The higher your deductible, the lower your insurance premium will be. After you pay your deductible, the claim compensation from your insurance carrier is the damage amount minus the amount of your deductible.
This type of deductible is often used for catastrophic events or large losses that are unfortunately common, like hail/wind damages or hurricane damages. When you live in an area that is prone to natural disasters, like hurricanes in Florida, your insurance policy may have a separate percentage-based deductible for instances like hurricane damages.
Flat-dollar amount, or dollar-value, deductibles are often used for most common property damages or losses. A standard homeowners’ policy has a dollar-value deductible of between roughly $500 to $2,000 depending on your policy. You will want to choose the dollar-value deductible to meet the coverage needs of your home.
Split deductibles often take into account the type of damage or claim that is filed. This means that the higher deductible which may be percentage-based even if they generally use dollar-value deductibles can apply to specific situations or hazards. Split deductibles use a dollar-value deductible most of the time, but they may switch to percentage-based deductibles in certain instances, like hurricane damage claims. If this occurs, the homeowner may have a specific deductible amount designated for specific reasons.
Some homeowners’ insurance policies only use certain types of deductibles no matter what type of claim is filed. When you are choosing your homeowners’ insurance deductible, you need to consider your finances. If you raise your deductible, you will likely have to cut your insurance costs in half and pay more money up front.
Many people choose higher deductibles simply because they want to reduce their out-of-pocket expenses. However, this can mean you pay more in the event of a claim. You need to weigh your options and consider the best situation for you.
These are a few things you should understand when choosing the right homeowners’ policy to cover your home and your property. By better understanding deductibles, you can choose the best option for your needs. If you have suffered property damage and need assistance with your claim, trust our public insurance claims adjuster in South Florida with all of your needs.
Contact Five Star Claims Adjusting to hear about our services today!