A Home Insurance Claim: To File Or Not To File
Insurance is meant to protect you against financial loss. But is it really meant to protect you from any and all financial loss? When it comes to filing a loss claim on your home insurance, there may be times when not filing may be the wisest course of action.1
According to one study, filing just a single claim could increase your monthly premium by 20 percent, depending on where you live.2
What About My Premium?
Contact your agent to find out if your rates could increase by filing the claim. If filing a claim means your premium will rise, you may need to decide whether it makes sense to do it.
It may not pay to file a claim if:
- The claim amount is small. Your policy will have a deductible, so even claims of $1,000 to $2,000 may not have a favorable long-term cost benefit.
- You're not covered for a loss. Read your policy first to determine coverage. The simple act of filing a claim (even for a claim that won't be paid) may result in higher premiums.
- You have filed a claim within the last seven years. Since previous claims are tracked by an industry database for seven years, it may result in higher premiums.
Another factor to consider: you may want to file a claim regardless of dollar amount if someone is injured on your property irregardless of whether you were responsible for the claim or not. You will want to turn the claim into your carrier or insurance agent in order to protect yourself in the event that you are sued by the injured party.
1. Several factors will affect the cost of homeowner's insurance, including the location, size and contents in the home. You should consider the amount of your deductible and level of coverage before purchasing a policy. Any guarantees associated with a policy are dependent on the ability of the issuing insurance company to continue making claim payments.
2. National Association of Realtors, 2019
Contact McDaniel Insurance Agency in Shelbyville, KY for all your home insurance needs. We can be reached at 502.909.0920.