The entire Midwest experienced high wind this weekend, and today our thoughts are with those who suffered through tornadoes.
That said, we've met homeowners who don't know the difference between a percentage and flat deductible, and still more who don't know that many carriers use a separate deductible for wind and hail damage, which could be flat or a percentage. Here's the difference between the two:
A flat deductible means that when you have damage that's the result of a covered loss, the insurance company will pay up to the limit of liability -- in the case of a home is usually the replacement cost of the house, not the market value -- less the stated amount. So if you have a $1500 deductible and $30,000 of roof damage, the company should pay $28,500.
A percentage deductible fluxuates with the limit of liability. For example, if your house has a reconstruction value of $100,000 and a wind/hail deductible of 1%, then your deductible for this kind of damage is $1000. If the reconstruction cost of your home is $472,800, then the deductible is $4728, and in the roof loss briefly described above, the company should pay $25,272.
What's the other difference? A percentage deductible often means a lower premium, since the carrier is assuming less of the risk. However, it's important to know ahead of time how much you're responsible for in the event of a loss. If the wind only causes $5000 in damage, a $1500 deductible is much different than a $4728 deductible, and may change your opinion on filing a claim -- and may be something you wish you'd known earlier.
If you have any questions about this, contact your agent. Or contact us. Every company is different, so all the broadly-defined scenarios above should be treated as such, and not specific to your policy.