Most people know that medical insurance deductibles work – once you reach your deductible limit, you’re responsible for copays and prescriptions. But how does that work when it comes to homeowners insurance and auto insurance?
Home Insurance
The general idea is the same, but instead of covering medical procedures or doctor visits, home insurance covers property damage, floods, fire, leaks, jewelry, fine arts, personal property damage, and more.
If your homeowners’ deductible is $20,000 and your home catches on fire, destroying the foundation and almost everything inside valued at, let’s say, $200,000, you would receive a claims check for $180,000, as long as you have the right insurance plans and coverage.
Suppose you’re working with a percentage-based deductible. For example, if your home is insured for $200,000 and you pay a four percent deductible, $8,000 would be deducted from your claim; so, if you had a $10,000 claim, you would collect $2,000; if you had a $50,000 claim, you would receive $42,000.
The cost of the deductible, in many cases, determines the coverage and premiums. Therefore, always ask your insurance agent if increasing your deductible can help you in the long run.
Home insurance is so important because it covers the most valuable things in your home. We work with every individual to ensure that they receive the options that best fit their specific home and lifestyle needs. Take a look at our complete home insurance offerings here.
Auto Insurance
Aside from your home, your car is probably your biggest asset so it’s vital that you protect it. The right auto insurance will protect you against losses out of your control and can help so that you are not without transportation, even in an accident.
A car insurance deductible is the total amount you pay towards repairs; your insurance company pays the rest. For example, if you are in an accident that causes $5,000 worth of damage and your deductible is $1,000, you are only responsible for that $1,000; your insurance company will cover the remaining $4,000 in damage.
Much like home insurance, having a higher deductible could lower your monthly insurance premium and offer higher benefits. In this case, it’s important to choose a deductible that you can afford. If you can’t afford $1,000 in repairs, talk to your insurance agent about a smaller deductible.
In most states, your auto insurance covers the damage you cause to other cars in an accident. Your insurance will likely also cover some medical bills resulting from a car crash. Having the best automobile insurance can make a difference. For example, it can protect your car against theft, damage by fire, or damage by an uninsured driver. Our complete auto insurance offerings are here.
Home and auto insurance are crucial to have, and understanding the best coverage for you, including your deductible limit, can significantly impact your life and the results of any damage. If you need a new policy or are looking for more information, reach out to us for more information on how we can help you select the right coverage when it comes to your home and auto insurance needs.
