What happens if you file a claim and have to pay a deductible?
That amount you’ve been earning the last few years will be subtracted from the deductible amount you owe.
Let’s put it into perspective: your apartment or condo was burglarized, and your electronics were stolen. The cost to replace your valuables is $2,000, but before your insurance kicks in to cover the cost, you have to pay your $500 renters deductible. You were planning on saving for a new car this year and aren’t happy about handing over a $500 deductible before your insurance pays to cover the damage — and thankfully, now you don’t have to.
Since this is the first renters insurance claim you’ve filed in three years, you’ve earned a $300 Diminishing Deductible amount and knocked your deductible amount to $200. Now you’ll only have to pay $200 before your insurance kicks in to cover the remaining $1,800.
So, what’s the catch?
There isn’t one! We want to help you be more comfortable and prepared with the out-of-pocket costs that come with filing a renters insurance claim. This new coverage is a way to mitigate the financial hits that can come with the unexpected.
Once you’ve paid to add this coverage to your renters policy, you’ll continue to earn a lower deductible each year up to your policy maximum.
If it’s five years down the road and you still haven’t filed a claim, that reward will stay put until you need to use it. Just make sure you don’t let your policy lapse for 60 days or more, cancel your policy or remove this coverage from your policy since you won’t be able to get the accumulated amount back.