If it’s your first time searching for Homeowners Insurance, you’re probably confused by all of the insurance jargon. Fortunately, most terms are simple to understand when broken down into everyday language. The same is true for deductibles and premiums, two essential components of your home insurance policy.
What is the Deductible on My Home Insurance?
The deductible on your Homeowners Insurance comes into play if you need to file a claim. For example, a tree falls onto the house after a windstorm, causing structural damage. Following this incident, you’ll need to file a claim with your insurance company to help cover the repair costs.
Your deductible represents the out-of-pocket costs you have to pay before the insurance company starts to reimburse you for the remaining damages. Many home insurance providers have a minimum deductible between $500 and $1,000.
The Pros and Cons of High Deductibles
If you choose a high deductible, you can expect certain advantages such as:
- Lower monthly insurance rates
- Lower rate increases following a claim
On the other hand, you’ll also run into disadvantages.
- Higher out-of-pocket costs following a claim
- High deductibles apply to all claims, regardless of size in most cases
When considering a higher deductible, it’s essential to remember what could happen in the event of a claim. Coverage should be comprehensive but also within your budget.
What is My Home Insurance Premium?
Your home insurance premium is the cost of your coverage. Typically, you’ll have the option to pay monthly, bi-annually, or annually. The average national monthly cost of Homeowners Insurance is around $100, but many different factors add to the overall price.
Agent quoting systems often consider your income, age, marital status, credit score, location, home size, build type, and deductible. In most instances, a higher premium means lower deductibles, and higher deductibles mean lower premiums.
The Pros and Cons of High Premiums
Choosing a policy with higher premiums can have its advantages.
- Broader coverage and higher policy limits
- Lower out-of-pocket expenses for claims
Some of the disadvantages of high home insurance premiums include:
- Higher monthly rates
- Rate increases following a claim
Note: Rates can increase after a claim regardless if you have a higher or a lower policy premium.
An insurance agent can help you maximize the value of your policy. Advanced cost estimating tools from your agent or your insurance carrier, can help you determine precisely how much coverage you need.
Optimizing Your Homeowners Insurance
The average cost of a new home in Illinois is $215,891, and prices are predicted to increase up to 6.4% by 2021. Additionally, Illinois homeowners have to pay the second most expensive property taxes of any US state. With these considerations in mind, it’s essential to keep Homeowners Insurance costs under control.
- Inflation Guard Endorsement – Also known as a Cost of Living Adjustment Endorsement, this addition to your home insurance policy can help ensure your home has sufficient limits in the case of a total or partial loss. Increasing the amount your home is insured for also increases your coverage B (Other structures,) C (Personal Property,) and D (Additional Living Expenses.)
Your insurance agent can take all aspects of your home insurance needs into consideration, helping you devise a coverage plan that maximizes value and protection.
How Myers Insurance Group Can Help
Numerous factors are involved when it comes to finding the right home insurance policy. The Myers Insurance Group in Savoy, Illinois, uses years of local knowledge and experience to pair homeowners with high-value, affordable, and personalized coverage options.
You don’t have to choose between high deductibles or high premiums for your Homeowners Insurance. Myers Insurance Group helps you balance your coverage needs, finding you comprehensive and budget-friendly protection in Savoy, Illinois, and the surrounding area.
To learn more about Home Insurance Deductibles and Premiums, contact Myers Insurance Group. We always look forward to answering your inquiries.