Should You Carry High Deductible Home Owner Insurance?

If you’re like most Americans, you’re doing some fancy footwork juggling bills and making ends meet. If there’s another penny to be squeezed, you’re the first guy asking for pliers. One way to save is to carry a higher deductible on your homeowners insurance. But before you take that route, ask yourself a few questions first.

Yes, a higher deductible on your homeowners insurance policy will bring down your monthly premiums. But it also means you’ll have to cough up more cash if you file a claim. Basically, a higher homeowner deductible means you assume more responsibility for fixing things. So if Junior lobs a line drive through the living room window, it will probably be cheaper to foot the repair bill than to file a claim. That’s okay, because you probably shouldn’t be filing claims against your homeowner policy for every minor repair, anyway, since that’s likely to lead to higher premiums. But what about a really big problem that requires a hefty out-of-pocket cash infusion?

Do you live in an area that is prone to heavy weather like tornados and blizzards or natural disasters such as wildfires or mudslides? Something like that can put a world of hurt on your house and the cost of the deductible could add up to more than the savings you realized from lower premiums. Depending on where you live, you may be required to carry a separate deductible for certain kinds of damage, anyway. Check with your insurance company before you raise your general homeowner insurance deductible, or you might be in for a nasty surprise when you file a claim.

How likely are you to set aside savings from the lower homeowner insurance policy premium so that you’ll have the deductible if you need it? Only you know your money habits. If you’re a diligent and faithful saver, go for the higher deductible. If you’re more likely to blow the extra bucks on a big screen TV for the Super Bowl, this may not be the best course of action, especially if you suddenly need to come up with $1,500 to cover your deductible obligation before you can fix the hole that fallen tree limb punched in your roof.


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