How to Choose Your Homeowners Insurance Deductible Amount

Homeowners insurance provides the financial protection you need against everything from pipes freezing and other water damage, to wildfires and burglaries. Because the deductible amount affects the premium you’ll pay for the year, choosing a deductible amount is one of the most important decisions you’ll make regarding your Homeowners insurance. Here’s what you need to know to make a smart decision.

What is a deductible?

A deductible is the amount of money you must pay on an insurance claim before your insurance pays. Unlike your premium, you do not pay your deductible to the insurance company. Instead, that money goes toward the claim. In other words, if your claim is for $5,000 and your deductible is $1,000, your insurance would most likely pay the total amount to your service provider and charge you the deductible amount. While most Homeowners insurance policies use dollar-amount deductibles, there are also percentage-based deductibles that are based on a percentage of the actual dwelling coverage amount. If you’d like to learn more about your policy options, make sure to contact an independent agent today!

What is the standard deductible for Homeowners insurance?

Because every home and every policy are different, there is no standard deductible amount. However, an average Homeowners insurance deductible tends to be between $500 and $1,000. At Grange Insurance Association, our minimum Homeowners insurance deductible is $500, and our maximum deductible is $2,500.

What factors should you consider when choosing a Homeowners insurance deductible?

There are two main factors to consider when choosing your deductible: what you’re comfortable paying out of pocket for a claim, and long-term cost considerations. While you want to make sure your deductible is an amount you’d be able to pay in the event of a claim, the higher your deductible, the lower your premium. That’s why we recommend choosing the highest deductible you’re comfortable paying, as paying more in the short-term can save you money in the long-term.

How can we help?

At Grange Insurance Association, we partner with local independent insurance agents to help you get tailored solutions for your individual needs. Our agents work in California, Colorado, Idaho, Oregon, Washington, and Wyoming, and will be more than happy to meet with you to discuss your questions about Homeowners insurance deductibles. Worried about finding an insurance company you can trust? We were recently awarded one of Forbes 2022 America's Best Insurance Companies.

The content available via Grange.com is for informational purposes only and may not be used for any other purpose. Content provided or expressed on Grange.com, including that of third parties, may not reflect Grange Insurance Association’s (GIA) policies or conform to any agreement you may have with GIA and its subsidiary companies. Please contact a licensed insurance agent to obtain particular advice.