When deciding on the types of fire/hazard property insurance coverage for a small business, an owner needs to consider a number of policy variables.
Property insurance may contain a deductible. This amount of a loss is borne by the insured. A deductible is designed to make the insured person self-insured for relatively small losses.
Various deductibles should be compared. A higher deductible frequently is a way for the insured to obtain coverage at a significantly lower premium cost. At the same time, the insured is still covered for any large or catastrophic loss.
For example, a $500 deductible for collision coverage on an automobile property policy can yield significant premium savings, in comparison to, say a $250 or $100 deductible. The same holds true for virtually any property insurance policy.