{"id":1909,"date":"2013-10-30T12:39:10","date_gmt":"2013-10-30T19:39:10","guid":{"rendered":"http:\/\/financegourmet.com\/blog\/?p=1909"},"modified":"2013-10-30T12:39:10","modified_gmt":"2013-10-30T19:39:10","slug":"right-homeowners-insurance-deductible","status":"publish","type":"post","link":"https:\/\/financegourmet.com\/blog\/insurance\/right-homeowners-insurance-deductible\/","title":{"rendered":"Right Homeowners Insurance Deductible"},"content":{"rendered":"

Most property insurance works the same way. Therefore, if you understand your auto insurance<\/a>, you understand a lot about your homeowners insurance, or house insurance.<\/p>\n

The basic moving parts of a homeowners policy are much the same as car insurance. There is a property insurance part in case something happens to your home, which is like the comprehensive or collision insurance part of your car insurance. There is a liability insurance component much like the liability part of your auto insurance. There is a premium that you have to pay in order to keep your coverage in both types of policies. And, finally, both types of insurance<\/a> have a deductible, or an amount that you have to pay before your insurance kicks in.<\/p>\n

Understanding Homeowners Insurance Policies<\/h3>\n

There is a thing about home insurance that some people don’t know. Insurance companies can sometimes cancel homeowners policies if there are too many claims filed for the insured property. In some cases, it only takes two or three claims over the years to get cancelled. And, almost all homeowners insurance claims lead to higher rates. Even worse, when you apply for insurance with a new company, one of the first questions is whether or not you’ve ever had a policy cancelled by another insurance company. If you do have a cancellation on your record, it can lead to higher rates from the new company, or an outright denial to sell you coverage.<\/p>\n

\"Home<\/a>If you are thinking that it isn’t really fair that an insurance company would cancel your policy just because you filed claims against insurance that you rightfully paid for, you aren’t wrong. However, you don’t make the rules, the insurance companies do, so you need to understand them in order to get the best value for your policy.<\/p>\n

The best way to avoid being cancelled or having your rates increase is to not file homeowners claims for smaller damages. For example Colorado homeowners insurance claims are common for minor damage to the roof caused by hail or high winds. In some cases, there can be legitimate damage every year or two from storms. Filing a claim each time is a surefire way to have your insurance not renewed. So, you won’t want to file a claim for every little home repair.\u00a0If you are thinking that you shouldn’t be paying for something you can’t use, you’re right, and that is why it is important to get the right homeowners insurance policy deductible.<\/p>\n

The Proper Homeowners Policy Deductible Amount<\/h3>\n

To avoid too many claims, you’ll want to take care of minor damages yourself. While a $600 roof repair bill isn’t fun, it is better than having your rates increase by a few hundred dollars per year, or being forced off of your insurance. But, if you won’t be filing smaller claims, then you shouldn’t be paying for that coverage either.<\/p>\n

The right insurance deductible is the amount for which you will be filing a claim, compared to how much more the premium is. For example, a $250 deductible is nonsensical. Filing claims for that small of an amount is going to cost you more in the long run in the form of higher premiums or difficulty getting coverage. Many experts suggest that you only use your insurance for large claims, and set aside an emergency fund for everything else.<\/p>\n

That means you want a deductible of at least $1,000. If the claim isn’t this big, chances are you are better off not filing it anyway, which means you shouldn’t be paying for a lower deductible.<\/p>\n

You might even try a higher deductible, however, my experience has been that the premium savings for a $1,500 or $2,500 deductible are typically very small, so it might not be worth it.<\/p>\n

Be sure you have an emergency fund to cover small damages. It might not seem pleasant to pay for repairs out of your own pocket, but it makes the most financial sense<\/a> in the long run. Just don’t pay for coverage you can’t or won’t use.<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Most property insurance works the same way. Therefore, if you understand your auto insurance, you understand a lot about your homeowners insurance, or house insurance. The basic moving parts of a homeowners policy are much the same as car insurance. There is a property insurance part in case something happens to your home, which is like the comprehensive or collision insurance part of your car insurance. There is a liability insurance component much like the liability part of your auto insurance. There is a premium that you have to pay in order to keep your coverage in both types of policies. And, finally, both types of insurance have a deductible, or an amount that you have to pay before your insurance kicks in. Understanding Homeowners Insurance Policies There is a thing about home insurance that some people don’t know. Insurance companies can sometimes cancel homeowners policies if there are too many claims filed for the insured property. In some cases, it only takes two or three claims over the years to get cancelled. And, almost all homeowners insurance claims lead to higher rates. Even worse, when you apply for insurance with a new company, one of the first questions is … <\/p>\n

Read More<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[599,600,660,663],"class_list":["post-1909","post","type-post","status-publish","format-standard","hentry","category-insurance","tag-home","tag-house","tag-insurance","tag-personal-finance","no-featured-image-padding"],"_links":{"self":[{"href":"https:\/\/financegourmet.com\/blog\/wp-json\/wp\/v2\/posts\/1909","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/financegourmet.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financegourmet.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financegourmet.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/financegourmet.com\/blog\/wp-json\/wp\/v2\/comments?post=1909"}],"version-history":[{"count":0,"href":"https:\/\/financegourmet.com\/blog\/wp-json\/wp\/v2\/posts\/1909\/revisions"}],"wp:attachment":[{"href":"https:\/\/financegourmet.com\/blog\/wp-json\/wp\/v2\/media?parent=1909"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financegourmet.com\/blog\/wp-json\/wp\/v2\/categories?post=1909"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financegourmet.com\/blog\/wp-json\/wp\/v2\/tags?post=1909"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}