If you see yourself in a short term tight financial situation and you’re concerned that a catastrophe in the home could wipe you out, then you could consider lower your insurance deductible. By lowering your insurance deductible, your monthly payments will increase but your deductible will be lowered. That is, in the event of a catastrophe, the amount you need to pay for, before insurance kicks in, will increase. This prevents you from a large payment but forces you to make smaller individual payments, it’s a trade-off you must make and for you to decide whether its right for you.
For example, let’s say you are concerned that your deductible of $1,000 is enough to put you in a tough spot. You could lower that number to $500 and then pay the extra monthly payments for that added protection. That means that in the event someone causes $5,000 of damage to your home, the cost to you is $500 instead of $1000.
If you want to save monthly costs, raise your deductibles. If you want to reduce your exposure to risk and are willing to make the payments, lower your deductibles.
Post a Comment