The deductible is one of the most important decisions you make when setting up an insurance policy — and most people choose it almost randomly, without thinking through what it actually means.
Here's what I want every client to understand.
What a Deductible Actually Is
Your deductible is the amount you pay out of pocket before your insurance coverage kicks in for a claim. If your car suffers $5,000 in hail damage and your deductible is $1,000, your insurance pays $4,000.
Simple enough. But there are important nuances — especially in Texas home insurance.
Texas Home Insurance: The Percentage Deductible
Many Texas homeowners policies don't have a flat dollar deductible for wind and hail claims. They have a percentage — typically 1–2% of your home's insured dwelling value.
On a home insured for $400,000, a 2% hail deductible means you pay the first $8,000. Every time. That's not a trivial number — and most homeowners don't know what their percentage deductible is until they're filing a claim.
This is one of the first things I review in every coverage conversation.
High Deductible vs. Low Deductible
Higher deductible = lower premium. Lower deductible = higher premium and less out-of-pocket when something happens.
The right answer depends entirely on your financial situation. The question I ask clients: if your deductible came due tomorrow, could you pay it without going into debt or serious financial stress?
If the answer is no, that deductible is too high for you — regardless of the premium savings.
When to File a Claim (and When Not To)
Many clients don't realize: filing frequent small claims can raise your premium significantly and even lead to non-renewal. For small claims that are just above your deductible, it's worth considering whether to pay out of pocket rather than file.
This is a conversation I have with clients regularly. I'd rather help you make the right strategic decision than watch your rate go up after a $1,500 claim.
The Right Deductible Is Personal
There's no universal right answer. It depends on your savings, your risk tolerance, and your specific coverage situation. What I can do is run the numbers and help you find the balance that makes sense for you — not just the number that sells fastest.