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Home Insurance Deductible?
01-08-2021, 10:54 AM
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#1
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Thinks s/he gets paid by the post
Join Date: Nov 2016
Location: Washington State
Posts: 2,349
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Home Insurance Deductible?
I just paid our home insurance for the year and was looking over the policy. I noticed the deductible is set at $1000, the default value set when we bought our first home. We didn't have much money back then and that's what the agent recommended, so that's what we went with. I never really gave it much thought.
These days we have a good emergency fund built up, so a low deductible isn't as important. Obviously I would need to talk with my agent to see how much our annual insurance bill would be affected by raising the deductible, but I'm curious what other folks have as their home insurance deductible?
To be honest, it wouldn't even cross my mind to file an insurance claim unless damage was in the thousands of dollars. $1000-$4000 or so and I'd probably just fix it out of pocket. Less hassle and I could get it fixed sooner. We've been insured 32+ years and have never filed a claim for anything.
What deductible do you have on your home insurance?
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01-08-2021, 11:07 AM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2008
Location: NC
Posts: 21,202
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I was at $1000, increased deductible to $2500. Like you, we've never filed a claim in over 40 years as we've never had a loss or expense that wasn't normal home maintenance.
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No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57
Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
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01-08-2021, 11:10 AM
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#3
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2004
Location: Laurel, MD
Posts: 8,309
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I think ours is $1k also. When I looked into raising it there was not much to gain from the additional exposure. Same with auto coverage. I wanted ~3k on the house. More significantly our coverage for windstorm damage was modified. It has a specific deductible which is a percentage of coverage. It was 1% of coverage IIRC. I think it’s a local thing in my state but probably some others too. We changed insurers, went back to a flat deductible and had a claim this year for wind damage.
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...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
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01-08-2021, 11:16 AM
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#4
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Recycles dryer sheets
Join Date: Aug 2018
Posts: 264
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Per Clark Howard: I have my deductible set at $1,000. I've only had 1 claim in 30 years, roof replaced due to hail damage. I'm thinking about raising the deductible to $2,500.
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01-08-2021, 11:22 AM
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#5
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Thinks s/he gets paid by the post
Join Date: Nov 2016
Location: Washington State
Posts: 2,349
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Quote:
Originally Posted by Midpack
I was at $1000, increased deductible to $2500. Like you, we've never filed a claim in over 40 years as we've never had a loss or expense that wasn't normal home maintenance.
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Did it have much impact on your insurance cost?
Our home insurance payment was $1012 this year, first time we've crossed the $1000 mark. Obviously, if a higher deductible only dropped it to $800 or so I don't know that it would be worth the effort. If it got down to $500-700, then it might be worth considering.
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01-08-2021, 11:27 AM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2008
Location: No fixed abode
Posts: 8,764
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Every time I looked into raising my deductible, it just wasn't worth it. Negligible cost savings.
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"Good judgment comes from experience. Experience comes from bad judgement." - Anonymous (not Will Rogers or Sam Clemens)
DW and I - FIREd at 50 (7/06), living off assets
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01-08-2021, 11:32 AM
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#7
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Full time employment: Posting here.
Join Date: Jun 2018
Posts: 929
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I think I may be at 1pct home value. So its true catastrophe insurance. I wouldn't make casual claims anyway
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01-08-2021, 11:32 AM
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#8
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Thinks s/he gets paid by the post
Join Date: Aug 2012
Posts: 1,824
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Mine is at Liberty Mutual and is $1000.
I just logged on and checked. They have an instant quote feature where you can edit your policy and see the difference.
I changed mine to a $2500 deductible and it would reduce the annual premium by $68.
For now I'll leave it at the $1000 level.
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01-08-2021, 11:33 AM
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#9
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Recycles dryer sheets
Join Date: Jul 2018
Location: Topanga
Posts: 313
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Mine is $1000. I made a claim in 1994 after the California Northridge Earthquake for repairs to my house and pool that saved me more than all of the premiums that I had paid to date ( or subsequent did pay since then) so I am ahead of the game.
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01-08-2021, 12:13 PM
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#10
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Thinks s/he gets paid by the post
Join Date: Nov 2015
Posts: 2,691
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So, how much would you save by increasing your deductible? How long to break even? Then ask yourself what your chance is of filing a claim in excess of $1,000 deductible and how many times within that period.
Last I looked it was many years to breakeven and amount saved wasn't worth making the change as savings was inconsequential. But YMMV.
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01-08-2021, 12:14 PM
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#11
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Recycles dryer sheets
Join Date: Jun 2016
Location: Grand Junction
Posts: 490
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As others have indicated your savings won't increase that much as your deductible is increased. That said, mine is 3% of the house value for a deductible of $17,442.
Just thought I would share so that you know there are a few high deductible policies out there.
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01-08-2021, 12:20 PM
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#12
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Moderator
Join Date: Dec 2007
Location: Eastern WV Panhandle
Posts: 25,299
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When we first bought the house it was (I think) $500 and when there were a couple of sharp premium increases I raised it to $1,500. Going to $2,500 or higher didn't make a lot of difference.
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When I was a kid I wanted to be older. This is not what I expected.
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01-08-2021, 12:31 PM
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#13
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Thinks s/he gets paid by the post
Join Date: Oct 2017
Posts: 1,137
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I've found the point of diminishing returns starts around $1,500.
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01-08-2021, 12:33 PM
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#14
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Thinks s/he gets paid by the post
Join Date: Feb 2014
Location: South central PA
Posts: 3,469
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Every three years or so we sit down with our insurance agent and review all aspects of our insurance: home, auto, umbrella. We tweak changes sometimes. I think we have a $1000 deductible on home and 0% on autos (older cars, no commute, well below our budget needs).
Twice in the past 20 years we had a basement flood from malfunctioning AC. Mostly carpet replacement. In fact, the first time was fantastic, we decided to replace the entire carpet with something nicer and saved quite a bit off of the total cost. We've been with the same company since 1984, so we get discount for being a steady customer.
It's a good idea to review insurance periodically. The agent can make tweaks and can quickly adjust coverage to meet your current needs.
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01-08-2021, 12:52 PM
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#15
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Thinks s/he gets paid by the post
Join Date: Nov 2016
Location: Washington State
Posts: 2,349
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Quote:
Originally Posted by EastWest Gal
Every three years or so we sit down with our insurance agent and review all aspects of our insurance
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Yeah, we usually do that too. We were supposed to come in in 2020, but that became a low priority when COVID hit.
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01-08-2021, 01:04 PM
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#16
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2013
Location: Texas
Posts: 10,863
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Our deductible(s) are $1k for "content" and 1% for the "home". After that, everything is insured for replacement cost up to the policy maximums.
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20's "something" mind, trapped in a 70's "something" body
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01-08-2021, 01:16 PM
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#17
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2004
Location: Laurel, MD
Posts: 8,309
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We are paying 30-40% less than we paid with the company that changed our deductible for wind damage from a flat amount to 1% of coverage. Any way you look at it homeowners coverage is usually a high value product but it still sucks how they jack up tour rates sometimes. That’s when it’s time for a change.
Our auto coverage jumped up because our carrier decided they didn’t like an adult child on our policy. We asked for fresh quotes from several providers and amazingly a few couldn’t even be bothered to reply, including our current broker. We switched to The Hartford AARP Plan and it saved us 30%. Our broker called after the switch to see why we switched. Now they call to wish us Happy New Year! So far they still have our homeowners policy.
__________________
...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
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01-08-2021, 01:20 PM
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#18
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Full time employment: Posting here.
Join Date: May 2011
Posts: 873
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Policy on home deductible is $1,300. We pay $1300 per year and that is with earthquake insurance whish has a 15% deductible.
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01-08-2021, 02:32 PM
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#19
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Thinks s/he gets paid by the post
Join Date: May 2019
Posts: 2,725
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My deductible on my first house was $100, then I increased it to $250, to $500, and it's been $1000 for years now. I asked about increasing it even higher to $1500 as my premiums continued to rise, and I didn't think the small drop in the premium was sufficient. If I needed to make a claim over the next 7 years that hit the higher deductible, it would break even. So I left it at $1000, which looks like the best compromise.
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01-08-2021, 02:51 PM
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#20
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Recycles dryer sheets
Join Date: Jan 2019
Location: Fort Worth
Posts: 99
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Our deductible is 1% (~$8,000). Like the others said, I wouldn't mess with insurance unless it was a substantial cost. Also, the higher deductible makes a worthy impact on our premiums.
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Retired Feb 2019 at 57 years of age.
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