Big Deductible Changes To Your Home Insurance Policy

It has always been the goal at The Resource Center to provide you with upfront and honest customer service in addition to adequate coverage and competitive pricing. As you may have experienced, the insurance landscape has changed considerably over the last several years, as rates have increased and costs industry-wide continue to rise. 

Over the years, we’ve seen the minimum required wind and hail deductible steadily increase, and the days of lower deductibles, at least for the foreseeable future, are behind us. We have seen every company we represent alter these coverages, and nearly every major carrier in the country has done the same. These changes vary depending on your carrier and their current guidelines. 

Percentage Deductibles

The biggest change has been a shift to a percentage deductible for wind or hail claims. This percentage represents 1% or 2% of the dwelling replacement cost (Coverage A) listed on your policy. 

For example, a $300,000 home would have a $3,000 (1%) or a $6,000 (2%) deductible for a wind or hail claim, while often maintaining a lower deductible for all other claims.

These changes have been implemented for a while on new business but we are now seeing companies apply these changes at renewal for current customers who previously had lower deductibles. These changes will be outlined when you receive your renewal documents.

The last thing we want for any customer is to be surprised by a potential change in coverage if a claim occurs.

As an independent agency, we are willing to do all we can to make sure our customers are placed with a carrier who has competitive rates and coverages but these changes are becoming the industry standard and may be difficult to avoid regardless of carrier.

Other Changes

In addition to minimum deductibles, other recent challenges include:

• Companies are non-renewing policies or no longer writing in the State of Missouri resulting in customers seeking out coverage for an incredibly difficult situation.
• If a home policy is moved to another carrier, that coverage could be discontinued based on an inspection of the home if certain underwriting requirements aren’t met, leaving you in a position where you are once again looking for coverage. 
• Companies are going to a payment schedule or depreciated value for roof coverage rather than full replacement coverage. (Contact your agent if you have recently replaced your roof)

Ways to Offset the Changes

There are many ways you can offset these increased costs by keeping up on your home maintenance which includes cleaning out your gutters, trimming trees, and keeping your siding in good shape.  Maintaining or increasing your credit score could also help keep your insurance costs reasonable. Paying your payment in full or bundling with the same company will also provide you with the maximum discounts available. If you have fast or young drivers look into the different telematic offerings which collect, measure, and transmit several data points which could affect your premium discounts.

The concept of sharing GPS data from a vehicle to a database is not particularly cutting-edge. Most cars equipped with navigation systems already have GPS technology. Telematics insurance systems send driving and vehicle data to monitor various aspects, including:

• Braking
• Acceleration
• Time of Day
• Speed

While we always want to find the most competitive rate, there are times when continuing with your current insurance company is optimal even if there are potential savings in the short-term. We are here to help you navigate this challenging ‘season of insurance’ in the best way possible. If you have any questions, whether you are a customer of ours or not, we’d be more than happy to chat about your options! For more information on how traditional insurance rates are obtained visit our blog titled “What Factors Determine Car Insurance Rates in Missouri?”  

 

About the author: At The Resource Center, we’re an independent insurance agency. That means we don’t work for a single insurance provider –we work for YOU! Our agents will shop your rates in the market so we can find the best deal for your budget.  For a free no obligation quote from Progressive, Travelers, Auto-Owners and Safeco click here!

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