Savings Vary by State, So Consumers Should Weigh Pros and Cons Carefully
SAN FRANCISCO – May 28, 2015 – Raising a homeowner’s insurance deductible from $500 to $2,000 lowers the average annual premium by 16% nationally and much more in some states, according to a new insuranceQuotes.com report.
North Carolina homeowners save the most (41%), followed by those in Rhode Island (26%), Florida (23%), Connecticut (22%), Pennsylvania (21%), Massachusetts (20%) and California (19%).
At the other end of the spectrum, the savings are minimal in Hawaii (4%), Indiana (6%) and Texas (also 6%). These meager savings probably aren’t enough to justify the added financial risk of a higher out-of-pocket deductible.
Switching from a $500 deductible to a $1,000 deductible results in an average savings of 6% nationally (from a high of 25% in North Carolina to a low of 1% in Kentucky).
“Since savings vary so much from state to state, consumers need to consider the bottom line before increasing deductibles,” says Laura Adams, insuranceQuotes.com’s senior analyst. “While switching from a $500 deductible to a $5,000 deductible sounds appealing because it lowers home insurance premiums by an average of 28%, it could be a risky move for consumers who don’t maintain that much in savings.”
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insuranceQuotes.com commissioned Quadrant Information Services to measure the impact of changing a homeowner’s insurance deductible in each U.S. state and the District of Columbia. Quadrant examined data from the largest carriers (representing 60-70% of market share) in each territory. The home specifications were kept constant in all regions.
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