When you’re in the market for homeowners insurance, you will probably spend a lot of time deciding whether to go for a policy with a lower monthly premium and high home insurance deductible, or a higher premium and a lower deductible. And though, in most cases, the amount of a home insurance deductible depends largely on how much the homeowner can afford on his or her monthly premiums, there are also other factors that influence insurance deductibles.
Do You Have the Cash?
It’s simple but true: the rainy day rule applies. No matter how much your home insurance deductible is, if you’re like most of us, you’ll have to dip into your savings in the event of damages. If you’ve got a savings account with a considerable amount of money you can access at any time, it might not be a bad idea to choose a higher home insurance deductible. With a higher home insurance deductible, you have the advantage of lower monthly premiums until disaster strikes—which it may never do. If this is the case, comparing quotes that feature a higher home insurance deductible should be your priority.
A Lower Home Insurance Deductible for Peace of Mind
If saving isn’t a luxury you can afford, or if you’re already using your savings for other things, like sending your children to college, it’s advisable to choose a higher monthly premium with a lower home insurance deductible. In the event of damages, you’ll be looking at a relatively lower sum for your home insurance deductible before your coverage kicks in. When comparing quotes, it’s the lower deductible that you’re looking for to keep your home safe.