Home insurance deductibles are rising nationwide as premiums continue to climb, leading more homeowners to increase their upfront financial risk in exchange for lower monthly costs. According to Insurify, the average deductible has increased about 40% over the past two years.
Industry analysts attribute this trend to the sharp rise in home insurance premiums following years of widespread natural disasters. As insurance costs surged, many homeowners began choosing higher deductibles to reduce overall expenses.
A recent survey by JD Power found that 47% of homeowners reported a premium increase within the past year, marking the highest share in over a decade. Matt Brannon, a data journalist at Insurify, noted that “recent years of premium increases have led to higher deductibles,” adding that this shift means more households are now carrying greater financial exposure.
The Insurance Information Institute (III) reports that raising a deductible from $500 to $1,000 can lower annual premiums by 10% to 25%, depending on the insurer, region, and property value. Most homeowners select deductibles between $500 and $2,000, with $1,000 being the most common amount.
Erica Tortorice, CEO of Optimum Solutions, expects this pattern to expand nationally through 2026. She said insurers in high-risk states or regions with frequent losses are increasingly limiting access to lower deductibles, leaving homeowners with fewer choices.
In areas where insurers have pulled back or restricted new policies, accepting a higher deductible has become one of the few ways homeowners can maintain coverage. However, experts emphasize that these higher deductibles must still be financially manageable.
Insurance attorney Anthony Lopez said insurers are more frequently offering new policies only with higher deductibles as part of their risk-control strategies. While this may allow homeowners in high-risk states such as California to obtain coverage, Lopez warned that it is not a complete solution and can shift more financial responsibility onto the homeowner.
Experts advise homeowners to evaluate their budgets and emergency savings before opting for a higher deductible. The key question, they note, is whether the homeowner can pay the deductible immediately if a loss occurs.
BY HOONSIK WOO [woo.hoonsik@koreadaily.com]
