Dave Ramsey says to raise your deductible to lower your home insurance premium — and that advice is still right. But in 2026, there is a gap between that principle and how it plays out on actual homeowners policies in hail-prone states like Colorado and Kansas. That gap could cost you thousands of dollars on the exact day you need your insurance most.
Here's the Short Answer
Dave Ramsey's advice to raise your deductible and fund the gap in savings is sound — but it only works when you know your actual number. Many homeowners in Colorado, Kansas, and other hail-prone states now have percentage-based wind and hail deductibles instead of flat dollar amounts. On a home insured at $500,000, a 2 percent wind and hail deductible means $10,000 out of pocket before your carrier pays anything. Most homeowners have no idea their deductible structure changed, because it happens quietly at renewal with no phone call and no highlighted notice. The fix: pull your declarations page, find the wind and hail deductible line, and do the math. If the number surprises you, call an independent agent who can shop the market for a better structure. And if you are in a hail corridor, a supplemental product called Sola wind and hail insurance may help you close that gap without putting a mark on your claims history.
Why Dave's Advice Works — And Why It Needs an Update
Dave Ramsey teaches people to raise their deductibles as part of a broader financial strategy: lower your monthly premium, redirect those savings toward debt payoff or your emergency fund, and self-insure the gap. The logic is sound. If you have a $1,500 deductible and $1,500 sitting in savings, you are covered. You have moved a manageable risk onto your own balance sheet and reduced what you pay the carrier every month in exchange.
We are a RamseyTrusted Pro at Trailstone. We believe in these principles. This is not an argument against Dave's framework. It is an update to it, because the market has changed in ways that his framework did not have to account for when it was originally built.
The core of Dave's advice assumes one thing: that you know your actual number. You raise your deductible to $1,000 or $2,500, you fund that amount in your emergency savings, and you are prepared. That assumption was reasonable for a long time. But for homeowners in hail-prone states like Colorado, Kansas, and Utah, there is a good chance that assumption no longer matches what is actually written in your policy.
The Shift From Flat to Percentage Deductibles
For most of the history of homeowners insurance, deductibles worked the way most people still assume: a flat dollar amount applies when you file a claim. You see a $1,000 or $2,500 line item on your declarations page, put that amount in savings, and you know exactly where you stand.
That structure is still common. But because hail damage claims have increased significantly across the country — particularly in Colorado, Kansas, and the broader plains and mountain states — many carriers have shifted to a percentage deductible for wind and hail specifically.
Here is the part that catches people off guard. A percentage deductible is not calculated based on your claim amount. It is calculated based on your home's insured replacement cost, also called Coverage A on your declarations page. The math looks like this: if your home is insured at $750,000 and your wind and hail deductible is 1 percent, you owe $7,500 before your carrier writes a check. If that deductible is 2 percent, you owe $15,000. That is a very different situation than the $1,000 flat deductible most people picture when they think about their policy.
What a Percentage Deductible Actually Costs You
| Home Insured At | 1% Wind/Hail Deductible | 2% Wind/Hail Deductible |
|---|---|---|
| $400,000 | $4,000 | $8,000 |
| $500,000 | $5,000 | $10,000 |
| $600,000 | $6,000 | $12,000 |
| $750,000 | $7,500 | $15,000 |
Why This Catches People Off Guard
The reason most homeowners do not know about this is straightforward: the change often happens at renewal, buried in a policy document that very few people read in full. You do not get a phone call explaining the shift. You do not get a highlighted line item in your renewal packet. It is simply there, on the declarations page, in the section that lists your deductibles.
There is also an agency structure issue worth understanding. If you are insured through a captive carrier — a company that only sells its own products — your agent may not have another option to offer you. When that carrier decides to move to percentage deductibles in your state, your choices are to accept the new terms or find coverage elsewhere on your own.
That is where working with an independent agency like Trailstone makes a practical difference. Because we work with more than 40 A-rated carriers, we can shop the market on your behalf. If one carrier's terms shift in a direction that does not serve a client well, we can find carriers that still offer flat deductibles or more favorable percentage structures. That is a conversation worth having before your next renewal, not after a storm.
How to Find Your Number Right Now
This takes less than five minutes. Find your declarations page — the one or two page summary at the front of your homeowners policy. It is usually the first document in your renewal packet, and most carriers also make it available through their app or online portal.
Look for a line labeled "Wind and Hail Deductible." In some states or policies, it may say "Hurricane Deductible" or "Named Storm Deductible." Look specifically for a wind and hail line, not just "All Other Perils."
Once you find it, look at the number. If you see a dollar sign, you have a flat deductible and you know your number. If you see a percent sign, take your Coverage A limit and multiply it by that percentage. That is your out-of-pocket obligation for any wind or hail claim, regardless of the size of the actual damage.
If that number surprises you, you are not alone. We hear this reaction regularly. The right move is to call your agent and understand your options before a storm, not after.
Applying Dave's Advice Correctly in 2026
Now that you know your actual number, Dave's advice applies exactly as intended — just with the right inputs. If you have a flat deductible and have funded that amount in your emergency savings, you are positioned well. Raising a flat deductible from $1,000 to $2,500 to reduce your annual premium by $200 or $300 is still a reasonable trade when you have the $2,500 ready.
If you have a percentage deductible, the question becomes: do you have that amount funded? For many homeowners — especially those who raised their deductible years ago without realizing the structure had changed — the honest answer is no. That is not a failure on their part. It is a gap created by a market shift that happened quietly.
The updated version of the advice is this: know what kind of deductible you have before you decide to raise it. Understand the actual dollar figure you would owe on the day you need to file a claim. Then make the decision. That is the whole point of the framework.
One More Option Worth Knowing: Sola Wind and Hail Insurance
If you review your declarations page and find that you have a percentage deductible, there is a supplemental product worth understanding: Sola wind and hail insurance.
Sola is not a replacement for your homeowners policy. It works alongside it. When a qualifying storm hits your area, Sola uses verified National Weather Service and NOAA data to confirm the event. If the storm meets the threshold, you receive a direct deposit payout — typically within seven to ten days. No adjuster. No contractor quotes required. No waiting on an inspection.
Two things stand out about how Sola works. First, the payout timeline is fast and predictable — you know what triggers a payment and roughly when it arrives. Second, and this is the part that surprises most people: a Sola claim is not reported to the CLUE database. CLUE is the claims history report that carriers check at renewal. When you file a traditional homeowners claim, it goes on that record and can affect your rates and renewal options. A Sola claim does not work that way.
Some homeowners use Sola as part of a deliberate strategy. Consider two families on the same street. Both have homes insured at $500,000. Both get hit by the same hailstorm. Family A has a 1 percent wind and hail deductible — $5,000 out of pocket. They file a homeowners claim, wait weeks for an adjuster, and now have a hail claim on their CLUE report. At renewal, their carrier may raise their premium or choose not to renew.
Family B took a different approach. They increased their wind and hail deductible to 2 percent, which saved them several hundred dollars a year on their homeowners premium. They used part of those savings to purchase a Sola policy. After the same storm, Sola verified the weather data and issued a direct deposit payout within about a week. Family B covered the repairs, did not file a homeowners claim, and their CLUE report stayed clean. Their premium was unchanged at renewal.
Family B came out ahead financially and kept their insurance record intact. It is not the right fit for every household, but it is worth a conversation if you are in a hail-prone state and your current deductible structure creates meaningful exposure.
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Frequently Asked Questions
Q: What is the difference between a flat deductible and a percentage deductible?
A: A flat deductible is a fixed dollar amount — such as $1,000 or $2,500 — that you pay toward a covered claim before your insurance pays. A percentage deductible is calculated as a percentage of your home's insured replacement cost (Coverage A), not the claim amount. On a $600,000 home, a 2 percent wind and hail deductible means $12,000 out of pocket, regardless of the actual storm damage.
Q: How do I find out which type of deductible I have?
A: Pull your declarations page and look for a line that says "Wind and Hail Deductible." If it shows a dollar sign, it is a flat deductible. If it shows a percent sign, multiply your Coverage A dwelling limit by that percentage to find your actual out-of-pocket exposure.
Q: Why are homeowners insurance carriers switching to percentage deductibles?
A: Hail claims have increased significantly in high-frequency states like Colorado and Kansas. Carriers use percentage deductibles to reduce their exposure on large roof claims, especially in areas where storms are frequent and repair costs are high.
Q: Can I switch back to a flat deductible?
A: It depends on the carrier and your state. Independent agents can shop multiple carriers to find one that still offers flat deductibles or a more favorable structure. Captive agents are limited to one company's options, which makes it harder to find alternatives.
Q: Is Dave Ramsey's advice to raise your deductible still valid?
A: Yes, with one important update: know what kind of deductible you have before you raise it. The principle of funding your deductible in savings is sound. The number you are funding just needs to match the actual number on your policy — especially if it is a percentage-based wind and hail deductible.
Q: What is Sola wind and hail insurance?
A: Sola is a supplemental insurance policy that pays out when a qualifying storm — verified by National Weather Service data — hits your area. Payouts are issued by direct deposit, typically within seven to ten days, with no adjuster or contractor quote required. Sola claims are not reported to the CLUE database, so they do not affect your homeowners insurance record or renewal pricing.
Q: Does Sola replace my homeowners insurance?
A: No. Sola is a standalone supplemental policy. It works alongside your homeowners coverage and is designed to help cover the gap created by a high deductible, not to replace your primary policy.
Q: Who benefits most from a Sola wind and hail policy?
A: Homeowners in hail-prone states — particularly Colorado and Kansas — who have a percentage-based wind and hail deductible. It is also a strong fit for anyone who has deliberately raised their deductible to lower their premium and wants a funded, CLUE-neutral backup for storm events.
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What to Do Before Your Next Renewal
Pull your declarations page and locate the Wind and Hail Deductible line.
Determine whether it is a flat dollar amount or a percentage. If it is a percentage, multiply your Coverage A limit to find the real number.
Compare that number to what you have in savings. Is the gap funded?
If the number surprises you, call your agent. Ask whether other carriers offer a flat deductible or a lower percentage option in your state.
Ask about Sola if you are in a hail-prone state and want a supplemental option that does not affect your CLUE record.
Review this at every renewal, not just when you buy a new policy. Deductible structures can change without a highlighted notice.
The goal here is simple. Dave Ramsey's advice is right: raise your deductible, fund the gap, lower your premium. The only thing that changes in 2026 is making sure you know what your actual number is before you decide. In hail country, that number may be very different from what you assumed.
Reach out to Trailstone via our website www.trailstoneinsurance.com or give us a call.
Trailstone will provide a complimentary review of your insurance and a written summary for your records.
Written by Mark Rodgers, President and Founder, Trailstone Insurance Group
Trailstone is an independent insurance agency licensed in Colorado, Arizona, Utah, Oregon, Washington, Idaho, and Kansas. We work with more than 40 A-rated carriers. All dollar figures in this post are illustrative examples.
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