Homeowners Insurance Deductibles: What You Need to Know

Let’s face it, the topic of insurance usually comes up only at the time when you need it most.

We don’t pretend it stays front of mind for those not used to putting customers together with the right insurance companies and homeowners’ policies like we do over here at Watley Insurance Group on a daily basis.

So, we don’t find it surprising when the question of when you pay for your homeowners insurance deductible tends to come up.

Sometimes, we even have to remind folks of what a deductible does when it comes to your insurance claim payments and what insurance companies will actually pay out for a covered claim.

Knowing when and how to pay your homeowners insurance deductible for homeowners insurance proves an important part of the claims process. A deductible typically must be paid when a claim is made, which helps make sure that homeowners are taking responsibility for the damages to their homes.

Here’s an in-depth look at what you need to know about deductibles and when they should be paid.

What Exactly is a Deductible?

A minimum deductible is an amount of money that you must pay out-of-pocket before your insurance company will cover any remaining costs associated with a homeowners insurance claim. Deductibles are typically expressed as a dollar amount and are generally determined by the type of coverage you have purchased.

The higher the deductible, the lower your homeowners insurance premiums on homeowners policies. In some cases, deductibles may be waived if certain conditions are met.

When a claim is filed, the homeowner will be asked to pay their chosen deductible, which is typically a set amount determined by the homeowner’s insurance coverage policy.

The deductible is usually paid upfront and can range from $500 to as much as $2,000 or more depending on the coverage limits that have been selected.

After the deductible has been paid, the insurer will cover any remaining cost as a claim payment.

When Is the Deductible Paid?

If your repair costs exceed your deductible and it doesn’t benefit you to pay out-of-pocket, homeowners insurance typically requires policyholders to pay a policy deductible up front before any other payments will be approved by the insurer.

Your insurer may request that you pay it when you submit your claim, or your claim needs to be accepted before making payment – either way it’s important that you know when and how much you owe.

How Much Is a Deductible?

The size of your homeowners deductible can vary greatly depending on your specific policy. Some policies require a flat rate while others require a percentage of coverage or damages.

Flat Deductible

A flat deductible is an insurance policy provision that requires the policyholder to pay a fixed dollar amount out of pocket for a covered loss. It is important to note that a flat deductible typically does not reduce the amount paid by your insurance company for the claim. Rather, the customer responsibility portion of the claim is based upon this predetermined, specified dollar amount.

For example, under a flat deductible system with a $1,000 deductible and you file a claim for $9,000 worth of damage caused by hail on your siding; then your insurance company would cover the remaining cost of $8,000 and you as customer would be responsible for paying $1,000 as per your pre-designated flat rate deductible. As long as damages are considered covered losses under your policy provisions, this system can help you save assets in times of need after damage or injury occurs.

Percentage Deductible

A percentage deductible is a beneficial option for those who wish to have some financial protection. This type of deductible bases the amount you will need to cover for claims on a percentage of the total coverage amount for your policy, such that any adjustment in the coverage amount is reflected in the deductible.

For example, with a home insurance coverage of $300,000 and 2 percent deductible, you would have an overall contribution of $6,000 ($300,000 multiplied by 2 percent)for each claim. This ensures that you are always aware of the exact payment required in case you make a claim.

In addition to being financially beneficial, having this type of deductible also adds more flexibility and provides more options when selecting an insurance policy. It’s important to look closely at each of these details when shopping around for an insurance plan that works best for your personal situation. By selecting a percentage deductible, it can help protect both yourself and your property with minimal effort on your end due to having this portion already accounted for when necessary situations arise.

Before signing up for a policy, make sure you understand exactly what your deductible is so that if you need to file a claim, there won’t be any surprises.

Where Can I Get Money for My Deductible?

If you don’t have cash on hand for your deductible, you may want to consider accessing funds from other areas such as savings accounts or credit cards if available.

If this isn’t an option, some lenders offer special loans specifically tailored to those who need money due after filing a homeowner’s insurance claim.

These lenders typically don’t mind waiting until your policy pays out before recouping their money as long as all conditions are met upfront.

What are the Next Steps After Paying a Deductible?

The process after paying your deductible usually includes filing a claim with your insurance company and providing all the necessary documentation to prove your damages. After this is complete, it’s up to them to decide whether or not they will cover the remaining costs of repairs or replacements needed.

If approved, you can then proceed with making necessary repairs or replacements using funds from your insurance company. If not, you may have to pay out-of-pocket.

During this time it’s important to keep accurate records in case anything comes up down the road where additional information is needed regarding repairs or replacements associated with your claim submission.

What Can I Do if I Can’t Afford My Payment Up Front?

If paying for repairs out of pocket isn’t feasible, there are other means available such as opening lines of credit from banks or using loan services offered by companies like Prosper Loans and PayPal Credit Lines – these offers tend to provide zero interest rates but can be expensive over time (it depends on your APR). Additionally, insurers may choose not to work with contractors who don’t accept certain forms of payment – so always ask beforehand what kind of payment methods are accepted just in case yours isn’t one listed above!

In conclusion, the deductible for a homeowners insurance policy will depend on when a claim is made and how much coverage you have. Generally, the deductible is paid when a claim is filed and it can range from $500 to several thousand dollars depending on your coverage.

In conclusion, we can’t stress how important understanding your policy and reading the fine print will benefit your peace of mind when making a claim.

You don’t want any surprises come claim time. You want to know the coverage you pay for protects you when you need it most.

So whether you live in Shreveport, Bossier City, Benton, Haughton, Keithville, Blanchard, or even Barksdale Air Force Base, go ahead and shop around for the best rates and coverage that meets your needs… That’s normal and advisable.

However, make sure you talk with us here at Watley Insurance Group.

As an independent insurance agency, we know all the ins and outs of homeowners insurance that fits our Ark-La-Tex customers. Contact us and we’ll figure out a solution for you.

Wayne F. Watley, Jr.

Agency Principal, proud husband & father, and jazz enthusiast.