Insurance deductibles can be confusing, and part of the purchase process buyers must understand so they can stay in budget. 

A deductible is simply the amount of money you pay before the insurance company pays on a covered loss.  If you have a $10,000 loss and a $1,000 deductible, the insurance company will only pay $9,000.  You are responsible for the difference.

Lenders may limit the amount that buyers can have for a deductible, so it is important to understand what is required prior to clos...