I am considering increasing my home insurance deductible from $1500K to $4000K. Will save me about 37% annually from the quotes i received.
My thought is most damage will fall under that $1500K #. If a major event does occur (ex: fire), then what is $4000K when something so drastic happens?
Just curios what more season investors are doing? The units are not in a LLC/legal entity and are in an urban area (C+ to B-) area.
I have all my deductibles at $5000. When I set them up that way years ago, I saved over $5000 the first year. So I am money ahead already.
I have many homeowners with higher deductibles ($2500 - $10,000), especially in the higher end properties. What we look at usually is the payback time (ie. how many years will it take for the savings on the policy to pay back the $2500 difference in deductible), what is the likelihood you would put in a claim in the $3000-$4000 range, and could you afford the higher deductible if you had multiple losses in a single year. Although Homeowners losses are infrequent they can come in groups (usually due to weather).
I think of insurance as protecting from catastrophic loss - go with the higher deductible.
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