When looking at insurance quotes our eyes automatically drift to the bottom line premium quoted. But what about all the stuff above it? Not all home quotes and/or policies are created equal. One of the key parts of a home quote and/or policy is the deductible. Below is a list of things to keep in mind as you consider a home quote and/or policy.
- Some deductibles are flat and some deductibles are percentages. Percentages are typically used in coastal areas where there is a higher probability of wind, hurricane, etc. A percentage deductible is based on the dwelling value listed in the policy. If the dwelling value increases the deductible increases as well.
- Some deductibles are specific to a type of coverage; Water Back-Up, Water Damage, Hurricane, Tropical Cyclone, Named Storm, Wind/Hail, etc. You may also see the term All Other Peril which means where a specific deductible is not identified the All Other Peril deductible applies.
- A home policy can have multiple deductibles which can be a problem if a claim triggers more than one deductible. Understanding how each deductible applies at the time of a claim is important.
- Some deductibles are dictated or required by the insurance company. This decision can be based on where the home is located, such as coastal. One insurance company may require a higher deductible than another insurance company.
- Some home policies waive the deductible for large claims or a total loss claim. Knowing when a deductible waiver applies is important. This can be beneficial in deciding on a high deductible.
- Some companies offer a reducing deductible if you remain claim free.
It is important when you are reviewing a home quote that you be aware of the deductibles. While a high deductible will reduce the policy premium, a high deductible can be detrimental if you can not afford the deductible at the time of a claim or the losses that occur are below the deductible. An insurance agent can help you review all the deductibles applicable to a quote and/or policy. An agent can also help you select a deductible that fits your financial situation while providing you the most advantageous premium.
The short and sweet answer is yes but I am not the short and sweet type when it comes to insurance. So let’s dig a little deeper.
Many individuals dont think they need it and many times forgo it to save money. Honestly this coverage is only about $30 to $40 per vehicle annually, if not less. That’s not alot when you consider it’s an annual cost and what it means for you.
Recently I had a client find out the hard way how important Rental Reimbursement is. Another vehicle hit my client’s vehicle while parked and unoccupied. Initially the client attempted to have the claim handled by the responsible party’s company. However the adjustor was indicating the vehicle was a total loss and that decision made the client uncomfortable. Add on the client had paid extra money for Replacement Cost coverage on the totaled vehicle on their own auto insurance policy. The client attempted to go back to their own insurance for Replacement Cost coverage but it was determined they had no Rental Reimbursement on their own auto policy. The claim process would start over with the client’s own insurance company and leave them out of pocket for another rental vehicle.
In the end the client settled with the responsible party’s insurance company to reduce the amount of stress and move on ultimately.
Had the client opted for Rental Reimbursement when the policy was purchased the client would have had a completely different result.
Yes, you can shave off a few dollars on your auto insurance by not including Rental Reimbursement but it can have a severe impact at the time of a claim.
So purchase Rental Reimbursement for all of your vehicles. I recommend a limit of $40 per day based on the average cost of a small rental vehicle. You can certainly bump it up if you will need more rental vehicle, such as a mini van or SUV.
An independent agent can help you pick the right limit and find a competitive auto insurance policy for you.
When you pick out a car is your only deciding factor the price? No! In your mind you have already picked a color and all the cool features you want. Leather seats, navigation system, parking assist, heated steering wheel, etc. The list is endless. You’ve done your research and know the listed price of the vehicle you want. You also researched pricing for your trade in and the financing. When you arrive at the dealership and finally get behind the wheel, you are in love. You are sold. You want that car no matter what. Price is a factor but not the only factor.
Insurance should be the same way. There is no one size fits all. There is no standard policy. Not all policies are the same. And price should not be the only deciding factor. There are a lot of benefits and features available and every insurance company has a different selection of coverages available.
With home there is water back-up, personal injury, and guaranteed replacement. With auto there is medical payments, rental reimbursement, and agreed value. Like buying a vehicle the more features you want the more it costs. Why would you settle for Kia coverage when you purchased a Mercedes? Why would you settle for a home policy designed for some one that has $0 assets when you need to insure a million dollar home?
Do the research. Know what the value of good coverage means to you. Don’t settle for typical coverage. Don’t focus on the bottom line when it comes to insurance. When something catastrophic happens you are going to want peace of mind, not the lowest price.