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Should I Raise my Deductible?

Services for Real Estate Pros with Rimmer Insurance & Financial

I love my wife.

Without her, I'd be almost completely oblivious to what they're saying in the news. Like many other men before me, I am the type who checks his stocks, the baseball scores, maybe go the advice section to see  what Haggar the Horrible and Charlie Brown suggest. It is due to these inbred habits of mine that I was completely unaware until my wife pointed it out that on the news and radio, reporters are telling people to raise their deductibles to $1000 or $2500 on their homeowners insurance in order to weather this economic storm.

I paused.

That is some pretty generic advice on a subject in which the "one size fits all" philosophy should be thrown out the window. I sort of equate that type of caution-to-the wind advice with my barber telling me not to buy a house in Cary because it is more expensive than Knightdale. You realtors know what I'm talking about, right?

Now, let's face it. This is probably the worst time in recent history for homeowners insurance rates to be going up. But they are. And we all must deal with it.

Now, insurance rates are very complicated as there are many factors that go into it. So not to bore you with numbers and insurance jargon, let me take my own homeowners insurance policy as an example.

I pay $572 annually on my homeowners insurance. That's $47.67 per month. I carry a $500 deductible. I decided to see what the difference would be if I raised my deductible to $1000. The annual premium drops to $532, or $44.33 monthly.

Think about it. I would save $3.34 per month. That means that I would have to go about 12 and a half years without a claim to break even on the savings AND have to dish out $1000 to have my claim handled. Do I expect to go twelve years without a claim? It could happen.

But not likely.

Chances are that I will have a claim within ten years. Whether it be a broken pipe that floods my house and ruins my belongings, or a windstorm, fire, a break-in... something is bound to happen.

Then there are cases of people who pay higher premiums perhaps due to claims history or bad credit-- sometimes the difference between a $500 and $1000 deductible could save $120 annually. In that case, a higher deductible certainly needs to be considered.

Anyways, the point that I am trying to get across is that instead of rushing to conclusions based on what our favorite DJ tells us; think of your Insurance Agent as that good spouse who can tell us when our outfit doesn't match, or remind us that instead of dwelling on baseball scores, to take a look at the news.

Let the people who get paid to handle your insurance, do their job.

Now, to put on my salesman cap; if you don't have an agent that can handle that type of interaction, please contact me and I'd be happy to take a look at your particular situation.

My office # is 919-217-6003 and my cell is 919-924-1594.

Warm Regards,

Steve "The Insurance King" Sommerville
















The Trumm Team Omaha Homes for Sale, Real Estate
Keller Williams Greater Omaha - Omaha, NE

Welcome to ActiveRain!

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If you ever have any questions, just let me know.

Troy Trumm, Trumm Team, Omaha NE

Jan 30, 2009 12:12 AM
David Painter
Keller Williams Realty - Spartanburg, SC

Good to have you on Active Rain.  This is a good site for gathering information and interesting to see what others are blogging about. Contact us if we can be of service to you. We would be happy to send you a referral or to take good care of any referral you would send to us.

Jan 30, 2009 05:46 AM
Everard Korthals
---Preferred Lifestyle Advisors--- - Lancaster, PA
Mountain Realty

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We hope you have a great day, All The Best- 

Sincerely, ( Active Castellum ( Castellum Realty llc - Lancaster PA Real Estate )

Jan 30, 2009 10:52 PM
Fred Griffin Florida Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

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     Leave a comment, post a Blog.
      Best to you!

Jun 18, 2015 11:19 AM