Mexico Home Insurance Deductible
Learn about the Mexico home insurance deductible, then quote & buy Mexico home insurance online.
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What is a home insurance deductible?
A home insurance deductible is the amount you, as the policyholder, pay out of pocket before your home insurance coverage begins. For your property in Mexico, this deductible is typically a fixed amount or a percentage of the total insurance value, which you agreed to when purchasing your policy.
How much deductible should I take?
The amount of deductilbe can vary depending on the type of coverage and the specifics of your policy but it’s designed to keep your insurance premiums more affordable. In the event of a claim, you’ll need to cover the deductible first, and then the insurance will cover the remaining costs up to the limits specified in your policy.
The Mexico home insurance offered with MexicoCovered.com offers you a range of home insurance deductible options for the “Fire All Risk” section of the policy. If you purchased Catastrophic coverage read below:
- Deductibles start as low as $500 USD.
- Maximum deductible is $20,000 USD
In fact, you can choose separate deductibles for dwelling, glass, personal property and theft. Extraordinary expense, debris removal and civil liability coverages are not subject to a deductible.
What about deductilbes for Catastophic Coverage?
The home insurance deductible for Catastrophic coverage is subject to a peril-specific deductible and coinsurance that may vary by the insured property location. The deductible is determined as a percentage of the insured amount. Generally, the closer the home is to the danger, the higher the deductible percentage, and the greater the insured’s out-of-pocket responsibility. Catastrophic deductibles start as low as 1% and can be as high as 5%. Coinsurance amounts vary from between 10% and 20%.
What is coinsurance?
Coinsurance is a feature of your catastrophe coverage that requires both you and the insurance company to share the cost of a claim. It is typically expressed as a percentage. For example, if your policy has 80% coinsurance, and the cost of a catastrophe claim is $100,000, the insurance will cover $80,000, and you are responsible for the remaining $20,000.
Coinsurance ensures that the responsibility for major damages or losses is distributed, helping to keep insurance premiums manageable.
Example: Catastrophic Coverage home insurance deductible and coinsurance:
Let’s assume your home is insured for $500,000, with 10% coinsurance, and a 2% deductible.
You have a loss of: $200,000
-
Step 1: The home insurance is calculated using the insured amount. The insured amount, multiplied by the deductible percentage to determine the deductible amount:
$500,000 x 2% = $10,000 -
Step 2: The home insurance deductible amount to be paid by the insured is subtracted from the loss amount. This results in the a remaining loss amount:
$200,000 – $5,000 = $195,000 -
Step 3: The coinsurance is calculated using the remaining loss amount. The remaining loss amount, multiplied by the coinsurance percentage, equals the coinsurance amount:
$195,000 x 10% = $19,500
The insured’s out-of-pocket expense would be the deductible amount plus the coinsurance amount.
$10000 + $19,500 = $29,500.