We compare a vector finite-difference method that correctly applies the boundary conditions at both horizontal and vertical dielectric interfaces (but not at corners or slanted interfaces) to algorithms that only approximately satisfy these boundary conditions. We find, rather unexpectedly, that for strongly guiding waveguides the boundary conditions imposed at the refractive-index discontinuities typically affect the calculated field distributions less than the procedure employed to assign the refractive index at a computational grid point. In fact, locally averaging the refractive index around each grid point transforms the precision of the most straightforward finite-difference models to that of far more sophisticated techniques. Further, H- and E-field formalisms exhibit identical accuracy.
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