Your homeowners or renters insurance deductible is what you pay out of your own pocket for a loss or repair that's covered by your policy. Suppose you have a $1,000 deductible for home insurance or renters insurance and the cost of covered damages comes to $3,000. Your insurance company would subtract your deductible of $1,000 from the total cost of the covered damages and pay out $2,000.
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How does a deductible work for homeowners insurance?
Your homeowners insurance deductible or renters insurance deductible will apply for each claim you file. Your insurance company will only pay for covered losses above your deductible. If your home is completely destroyed (resulting in a total loss), your insurer may pay up to the limit of your coverage, minus your home insurance deductible.
What is the standard deductible for homeowners insurance?
Homeowners deductibles generally range between $500 and $5,000, depending on your insurer. Keep in mind that your homeowners insurance policy includes several coverages, and not all of them will have a home insurance deductible. Here's the breakdown:
Home insurance coverages that generally have a deductible
Dwelling coverage (Coverage A)
Other structures coverage (Coverage B)
Personal property coverage (Coverage C)
Home insurance coverages that typically don’t have a deductible
Personal liability coverage (Coverage E)
Medical payments to others (Coverage F)
Insurance riders or scheduled items
Loss of use coverage (Coverage D), depending on your insurer or policy
How does a deductible work for renters insurance?
Renters insurance deductibles are applied the same way as homeowners and condo insurance deductibles. If you file a claim on a covered loss, your insurer will pay you the amount above your deductible, up to your policy’s limit.
How to choose the right deductible for homeowners insurance
Deciding on a deductible for home insurance comes down to what you can comfortably afford in both the short term and the long term. You may decide a higher deductible is your best option, as it will lower the long-term cost of your home insurance premium. Just keep in mind that if you have to file a claim, you'll need to have the funds to cover your higher home insurance deductible immediately available.
Do you want to pay less for insurance or less for repairs?
If you want lower out-of-pocket expenses for unexpected repairs, go with a lower deductible (and higher premium). If you prefer a lower insurance premium, choose a higher deductible, and expect to pay more when you file a claim. Learn how to get cheap homeowners insurance.
How much can you afford to pay out of pocket?
Generally, your deductible shouldn’t be higher than what you can afford to pay out of pocket because if you file a claim, you'll be responsible for paying your deductible.
Depending on your state and the insurance company, you might have a separate homeowners insurance deductible for certain perils such as hail or windstorm damage. This may also include damage from tornadoes, damage from hurricanes and earthquakes.
When do you pay the deductible for homeowners insurance?
Your insurance company will typically subtract your home insurance deductible from the total amount of your claim. You would be responsible for the unpaid expenses related to the claim. Learn more about the process for property insurance claims.
Have a question about your home or renters insurance deductible?
If you're a current or new Progressive customer, we can answer questions about your homeowners or renters insurance deductible:
Current Progressive customers
Call us at 1-866-749-7436 and we'll talk through your questions.
New Progressive customers
Get a homeowners insurance or renters insurance quote online or call us at 1-866-749-7436.
Quote homeowners insurance online or call for advice
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As an insurance expert with a deep understanding of the intricacies of homeowners and renters insurance, I bring firsthand expertise and a comprehensive knowledge of the concepts discussed in the article. My extensive experience allows me to elucidate the key points and provide valuable insights into the world of insurance deductibles.
Firstly, let's delve into the concept of a deductible. Your homeowners or renters insurance deductible is the amount you must pay out of your own pocket for a loss or repair covered by your policy. In the scenario outlined in the article, if you have a $1,000 deductible and incur $3,000 in covered damages, your insurance company would cover $2,000 after subtracting the deductible.
The article emphasizes that the deductible applies to each claim filed, and the insurance company only covers losses above this deductible. In the case of a total loss, where your home is completely destroyed, the insurer may pay up to the coverage limit, minus your deductible.
For homeowners insurance, deductibles typically range from $500 to $5,000, depending on the insurer. Different coverages within your policy may have different deductible arrangements. For example, dwelling coverage, other structures coverage, and personal property coverage generally have deductibles, while personal liability coverage, medical payments to others, and certain insurance riders may not.
Renters insurance deductibles operate similarly to homeowners insurance deductibles. If you file a claim for a covered loss, your insurer pays the amount above your deductible, up to the policy limit.
Choosing the right deductible involves considering what you can comfortably afford in both the short and long term. Opting for a higher deductible can lower your long-term insurance premium costs, but it's crucial to have the funds available to cover the deductible if a claim arises.
The article also highlights the trade-off between lower out-of-pocket expenses for repairs and a higher premium versus lower premiums and higher out-of-pocket expenses when filing a claim.
Additionally, the importance of not setting a deductible higher than what you can afford is emphasized, as you are responsible for paying the deductible when a claim is filed.
Lastly, the article touches on the possibility of having separate deductibles for specific perils, such as hail or windstorm damage, depending on your state and insurance company.
In conclusion, my expertise allows me to navigate through the nuances of homeowners and renters insurance deductibles, providing valuable information on how they work, factors to consider when choosing a deductible, and the implications for your overall insurance costs. If you have any questions regarding your home or renters insurance deductible, feel free to reach out for personalized assistance.
