DeductibleOne of the most common insurance issues is what the deductible should be. While only you can decide, here are a couple of thoughts that might help you.

When it comes to deductibles there are a few of questions you should ask yourself.

  1. How much cash do I usually have on hand?
  2. How much am I willing to pay out of pocket?
  3. What deposit amount do I receive from my tenants?
  4. What kind of discount am I looking for off my insurance premiums?

Each of these is pertinent to the deductible question. The first two are very much related. If you are able to keep cash available for business emergencies, and are willing to spend it, perhaps opt for a little higher deductible.

Now, for the deposit question. I wrote an article for a Magazine once that was entitled. Smoke, Fires, Lawsuits – OH MY! In it, I described a fire that happened just around the corner from my house. The tenant was a friend of mine. Long story short, as the family moved out after this devastating situation the landlord came and asked for the next month’s rent. It seemed like kind of a weird thing to do, in my opinion. She was clearly facing a major loss. But, if she had insurance, her property would have been covered for the loss caused by the fire. Her rents would have been protected by loss of use/rents, but she would have been on the hook for the deductible. Now, consider if her tenant’s deposit amount had been the same has her deductible, she would have had no out of pocket costs. ASSUMING SHE HAD VALUED THE HOUSE PROPERLY. But consider the concept of making the deposit match the deductible. In the event of a total loss, it could save your bacon (clearly, this assumes that if someone burns down your rental property, you’re not giving them the deposit back… I think that’s fair).

Finally the discount question: Deductibles are simple. The higher the deductible means you take more risk, and the lower the premiums. The lower the deductible means the less risk you take, and the higher the premiums. However, there is a reason I tackled this question last. This should be the determining factor. A $5,000 deductible that makes your premiums dirt cheap doesn’t make sense if you don’t have the $5,000 to pay when you have a loss.

While only you can determine what deductible is best for you, hopefully this is some good food for thought.

To get an incredible quote these coverage sections start our online quote form. To Talk to a licensed agent about this coverage call us at 1-877-784-6787.

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This coverage explanation is for illustration purposes only and is general in nature. Coverage explained here may not apply to your policy, State, company, or situation. For more information about how your policy would respond in the event of a loss, please refer to the terms and conditions and declarations page of your policy.

Gila Insurance Group LLC

805 W Court St. S
Safford, AZ 85546

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About Gila Insurance Group

Customers choose Gila Insurance Group LLC as their insurance agent because they like being able to fill out one application online and then getting multiple quote from highly rated insurance companies. They like the friendly staff that takes the time to help them understand what they are purchasing. They like that the staff is trying to get the best coverage for them at an affordable price, and they LOVE that once they are customers Gila Insurance Group monitors their rates. If rates start to get out of hand they love that they have someone looking out for them to see if they can find a better option!

While Gila Insurance Group LLC serves Safford, Thatcher, Pima and all of Southern Arizona, they are also licensed in 32 states and serve clients from all over Arizona, California and this great Nation. Gila offers a variety of products including auto insurance, homeowners insurance, RV insurance, and business insurance. However, Gila has several specialties which include insuring investment properties such as rental properties, and fix and flip projects and Manufactured and Mobile homes.