What is a deductible?
A deductible is the amount of money you'll be required to pay out of pocket toward repairs of your property due to a covered loss. Your deductible amount(s) can typically be found on your policy declarations page and may differ depending on the type or cause of loss reported.
The deductible can be a flat rate dollar amount or a percentage of the dwelling coverage.
- Flat rate dollar amount - You have a covered plumbing loss and the damages are $5,000. If your deductible is $1,000, you pay that amount directly to your contractor and your homeowners insurance would pay the remaining $4,000.
- A percentage of your dwelling coverage - Your deductible is a percentage of your insurance policy’s dwelling coverage amount. If your home is insured for $250,000 and your deductible is 1%, you're responsible for first $2,500 of covered damages (1% of $250,000 is $2,500) and your homeowners insurance pays the rest.
When is a deductible applied to a claim?
Your deductible is typically subtracted from the original settlement payment and only applies 1 time for each claim or loss.
Who collects the deductible?
Your policies & coverage
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