Home Insurance Advice Needed
Hi everyone! I’m contemplating two home insurance policies for my new house in Eastern Nebraska, which is valued at $390,000. The main difference between the options is the premium and the hail/wind deductible. The $400 annual premium difference is significant, but if I end up filing a hail/wind claim within the next 13 years, the higher premium might be justified. Both policies offer similar coverage overall.
Just a side note, I currently have my car insurance with Progressive at their platinum level, but switching isn’t a major factor for me right now.
Policy 1
Company: Progressive (ASI)
Premium: $1,100
Deductible: $1,000
Hail/Wind Deductible: $7,860
Policy 2
Company: National General by Allstate
Premium: $1,560
Deductible: $1,500
Hail/Wind Deductible: $2,500
I appreciate any insights or advice you can offer – thanks!
It sounds like you’re facing a tough decision! Here are some factors to consider that may help you weigh your options:
Wind/Hail Risk: Since you live in Eastern Nebraska, it’s important to evaluate the likelihood of experiencing severe weather events like hail and wind storms. If hail is common in your area, Policy 2 with the lower wind/hail deductible could save you a significant amount in the event of a claim.
Premium vs. Deductible: You mentioned the $400 premium difference per year. Over 13 years, that adds up to $5,200. If you end up making a claim under Policy 1 with the higher deductible, you would need to weigh that potential cost against the premium savings. For instance, if you face a hail damage claim that costs $15,000 to repair, you would be responsible for $7,860 (Policy 1) versus $2,500 (Policy 2). That’s a significant difference!
Coverage Similarities: Since both policies offer similar coverage, it may come down to the financial impact of a claim versus the upfront cost of the premiums. If you can afford the higher deductible comfortably, Policy 1 might seem like a better bet in terms of annual costs. However, if making a claim could be financially burdensome due to the higher deductible, Policy 2 could be worthwhile despite the higher premium.
Bundling with Car Insurance: Since you have a good rate with Progressive for car insurance, consider whether staying with them for home insurance might offer additional discounts. Sometimes bundling can lead to significant savings overall.
Peace of Mind: Think about your comfort level with risk. Some homeowners prefer the peace of mind that comes with a lower deductible, knowing that they won’t face a hefty out-of-pocket cost if something goes wrong, even if that means paying a higher premium.
Ultimately, consider running some scenarios. If you do face a major claim, how would each policy affect you financially? Weighing your risk tolerance along with potential weather conditions in your area could help guide your decision. Good luck!