Pay Attention to Deductibles A deductible is the amount a policyholder must pay out of pocket before the insurance company pays the covered amount on a claim (up to the policy limits). Standard homeowners policies typically have a flat deductible such as $500 or $1,000. In some states where there is a greater risk of a major catastrophe, higher deductibles may apply to some forms of coverage. A hurricane, for example, may trigger a specific deductible that is set as a fixed percentage, typically starting at 2% and reaching up to 15% of the policy limits. If a property is insured for $200,000 and the policy has a 2% hurricane deductible, for example, the first $4,000 must be paid by the homeowner. Claims for damage caused by windstorms or hail may be structured in a similar fashion. Homeowners Insurance Claims (weighted average, 2016–2020) The average property damage loss during this period was $13,804. Source: Insurance Information Institute, 2022 (most current data available) $11,650 $77,340 Wind and hail $4,415 Theft $11,695 Water damage and freezing Fire and lightning
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