Mobile home insurance is similar to homeowners insurance in that it offers personal property coverage, personal liability coverage and medical payments coverage. When a claim is presented, often a deductible is withheld from any payments made to the insured.

Deductibles

A deductible can be $100, $250, $500 or $1,000, depending on which option you choose when selecting a policy. This amount must be paid to a contractor by the homeowner in the event of damage and the need for repairs, and the insurer pays the balance of the claim if the damage is a covered event.

Premium Affect

Choosing a lower deductible raises your premium. Conversely, choosing a higher deductible will lower the policy premium. Deductibles discourage an insured individual from making small claims. For example, if your claim is $400 and you have a $500 deductible, you will not need to file a claim as you are responsible for the full $400. If your claim is $600, it would not be worth the $100 claim payment in the long run as your premiums may increase due to the number of claims you file.

Waiver of Deductible

If your claim is as high as your policy limit, your deductible may be waived. For example, if you have insurance for a diamond ring that you will have to pay $5,000 to replace but your claim limit for jewelry is only $4,000, you may recover a total of $4,000 with no responsibility for paying an upfront deductible.

Recovering Your Deductible

If the occurrence is caused by another party's negligence, your insurance carrier may pursue that party for recovery of the claim payment they made on your behalf and your deductible. If they are successful, your deductible is returned to you.

Considerations

When shopping for insurance, ask your agent to explain the differences in premium costs according to which deductible you might choose. Make your decision based on whether the savings between deductible levels is worth the extra expense.

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Mobile Home Insurance