"This policy contains a clause which may limit the amount payable." Many people don't fully understand the meaning of this. Almost all home insurance policies include this phrase somewhere on page one.
They are talking about the deductible on the policy. In the majority of policies, a deductible is paid by the policy holder when a loss is incurred. The amount of the deductible will vary depending on the loss that is incurred. Before the insurance company pays for a loss, the deductible must be paid by the policy holder. The premium is proportionally lower when the policy is larger.
Deductibles usually vary according to the kind of peril that caused the damages. The most common types of deductible are:
Glass breakage deductibles are to cover broken glass that is part of your home. In most cases, this deductible can be avoided with relatively small additional premium payments.
Earthquake deductibles cover insurance claims that result when an earthquake causes damage. There are usually varying kinds of deductibles that can be chosen in case of earthquake damage. The options are based on a percentage of the total limit of property covered under your condo insurance policy.
Crime deductibles cover theft, vandalism, burglary, and mysterious disappearance claims. Typically, this deductible only applies to rental and vacation properties. Generally there are $5,000 and $10,000 deductible options.
Water deductible: Applies to claims resulting from water.Typically, this deductible only applies to rental and vacation properties. The 2 basic choices are $2,500 and $5,000, depending on the policy holder's needs.
Standard policy deductibles are for to cover other kinds of claims that we have not covered here. Typically, you get to choose from several options, which range from $500 to $5,000.
Deductibles help keep your premiums down because they prevent payments being made on very small losses. This significantly reduces an insurance company's costs, thereby helping to keep everyone's premium down.
If you have a low deductible you may be tempted to make claims on very small losses. If you do, you could lose any "claims free discount" you may be enjoying. Base rates for the homeowner could rise after several smaller claims, and this could be actually more expensive than to repair or replace the damages on your own. Home owners who make claims too often sometimes find the insurance company refusing to renew their insurance.
Premiums will be much lower when the home owner makes the decision to have a higher deductible. The main reason to get insurance is to be protected from major losses like fires, water damages, burglary, or windstorms, not to make small claims when there isn't much damage involved. As such, it may be worth your while to opt for a higher deductible. Premiums will be lower when you repair or replace small damage or loss on your own, and overall, your costs will be lower. Your insurance will be there for you when you really need it.
They are talking about the deductible on the policy. In the majority of policies, a deductible is paid by the policy holder when a loss is incurred. The amount of the deductible will vary depending on the loss that is incurred. Before the insurance company pays for a loss, the deductible must be paid by the policy holder. The premium is proportionally lower when the policy is larger.
Deductibles usually vary according to the kind of peril that caused the damages. The most common types of deductible are:
Glass breakage deductibles are to cover broken glass that is part of your home. In most cases, this deductible can be avoided with relatively small additional premium payments.
Earthquake deductibles cover insurance claims that result when an earthquake causes damage. There are usually varying kinds of deductibles that can be chosen in case of earthquake damage. The options are based on a percentage of the total limit of property covered under your condo insurance policy.
Crime deductibles cover theft, vandalism, burglary, and mysterious disappearance claims. Typically, this deductible only applies to rental and vacation properties. Generally there are $5,000 and $10,000 deductible options.
Water deductible: Applies to claims resulting from water.Typically, this deductible only applies to rental and vacation properties. The 2 basic choices are $2,500 and $5,000, depending on the policy holder's needs.
Standard policy deductibles are for to cover other kinds of claims that we have not covered here. Typically, you get to choose from several options, which range from $500 to $5,000.
Deductibles help keep your premiums down because they prevent payments being made on very small losses. This significantly reduces an insurance company's costs, thereby helping to keep everyone's premium down.
If you have a low deductible you may be tempted to make claims on very small losses. If you do, you could lose any "claims free discount" you may be enjoying. Base rates for the homeowner could rise after several smaller claims, and this could be actually more expensive than to repair or replace the damages on your own. Home owners who make claims too often sometimes find the insurance company refusing to renew their insurance.
Premiums will be much lower when the home owner makes the decision to have a higher deductible. The main reason to get insurance is to be protected from major losses like fires, water damages, burglary, or windstorms, not to make small claims when there isn't much damage involved. As such, it may be worth your while to opt for a higher deductible. Premiums will be lower when you repair or replace small damage or loss on your own, and overall, your costs will be lower. Your insurance will be there for you when you really need it.
About the Author:
If you want to know more visit Edmonton house insurance, or visit www.squareoneinsurance.ca.
Comments
Post a Comment