When your homeowners insurance renews, be sure to check the small print for a possible change in how the deductible is calculated. Many of the major companies are moving from flat rate deductibles to a percentage of the home's value. The percentage may vary from 1% to 5%, depending on the home's location, and can substantially increase out-of-pocket expense in the event of a major claim. A home valued at $125,000 with a deductible percentage of 5% would require $6,250 before coverage would kick in.
Discuss possible options with your agent if this change occurs in your policy.
Source of information for this post: Progressive Farmer magazine, Oct. 07 issue.
Check Your Deductible
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