Your Deductible Still Says 1%. Why Did the Dollar Amount Go Up?

Your homeowners renewal shows up.

The price changed, so you start comparing it with last year's policy.

Then you get to the deductible.

Last year: 1%.

This year: 1%.

At first glance, it looks unchanged.

Now do the math.

Last year your home was insured for $350,000.

One percent was $3,500.

This year your home is insured for $385,000.

One percent is now $3,850.

The percentage stayed the same.

The dollar amount increased by $350.

Why the number changes

A percentage deductible moves with the amount the policy uses to calculate it.

If that amount increases at renewal, the deductible increases too.

That is why looking only at "1%" does not tell you whether your deductible stayed the same.

What to check at renewal

Compare last year's insured amount with the new one.

Recalculate the percentage deductible.

Check whether the policy still uses the same deductible structure.

Look for any other deductible changes.

Then write down the new dollar amount.

Do not stop at the premium

The premium gets most of the attention at renewal because it is the number you pay right now.

The deductible matters because it is the number you agree to take on when a covered loss happens.

Both deserve a look.

If the new deductible no longer works for you, compare the choices your current company offers and the premium difference. Then compare other companies if needed.

The percentage is useful.

The dollar amount is what you need to plan around.