What does increasing the insurance deductible represent in property management?

Choosing to increase the insurance deductible in property management signifies a decision to retain a greater portion of the financial risk associated with potential claims. In practice, a higher deductible means that the property owner is willing to cover more of the costs out-of-pocket before the insurance policy contributes. This can result in lower premium costs because the insurer assumes less risk. Therefore, by opting for a larger deductible, property managers and owners effectively decide to self-insure a part of the risk, thereby retaining responsibility for losses up to that deductible amount. This strategy is often employed to balance premium costs with the property owner's ability to manage certain risks directly.