This is always a tough one for people. “Why would I want a higher deductible?” you might ask. “I don’t want to pay more if there’s a claim.” you’re thinking. Au contraire my friend! You probably actually want a higher deductible. Here’s why-
First off, you have to think of a homeowners insurance claim differently than an auto claim (because it is). If your car gets dinged in a parking lot and you want a pristine, perfect looking auto again, you can take that claim. You may not even see an increase in premium. Chipped window? Claim! You’re not going to ruin your premiums or insurability by taking out a couple claims, especially if they’re small. This is absolutely not true of homeowners insurance! Small claims will ruin you. Homeowners insurance was designed for the big huge financial loss, like a fire, hail damage, etc. Claims are counted heavily, no matter the cost. If you have one, even if it’s small, you can almost guarantee a rate increase. If you have 2 or 3 (regardless of dollar amount) you could be dropped and have difficulty finding new insurance, much less a reasonable rate.
A higher deductible removes the temptation to take those small claims that can ruin you. If you have a $2000 deductible or higher, you are more likely to take out a claim if its really necessary.
Another thing to consider is that a deductible in home insurance is not like auto insurance. When you have an auto deductible and you go to the shop to pick up your car that got dinged in the parking lot, the shop won’t let you drive away till you pay them $500. This is not how homeowners insurance works. Frequently when claims are filed, an adjust will come assess the damage and cut a check for what they feel the damage will cost minus the deductible. Let me give you a real life example. Lets say there’s a hailstorm and you think you need a new roof. The claims adjuster comes out and says,”you need a new roof, our chart says it will cost $12000″. He will then write you a check for $10000 to fix the roof, or write a check for $5000 to get the work started and $5000 when its finished. Either way, you can hire whoever you want. If you can find someone who will do it for $10000, you don’t necessarily have to pay an out of pocket deductible.
Most importantly, a higher deductible means a lower homeowners insurance premium. You can save those dollars and, knock on wood, if you don’t have any claims you win. Even if you have a claim many years down the road, you’ll probably have saved enough to more than make up for the difference in deductible. Get a quote from us for a $2000 deductible and see how much you could be saving. The Beard’s got you covered!
