To Claim or Not to Claim: That is the Question…
Although you buy homeowners insurance to protect against losses, many people are still hesitant to file a claim; they don’t want to their premiums to go up. And while filing claims doesn’t always mean increased premiums, often it does. It’s important to know what triggers an increase.
For those claimants who file multiple claims annually, rates definitely will increase – usually significantly. Depending on claim amount and type, insurers may even cancel policies. Most homeowners don’t fall into this category; however, even you could face a premium increase, and you should be aware of why, how much, and for how long.
If you’re having trouble deciding whether to file or not, analyze your coverage, noting limits and exclusions. If your loss is covered, take the next step, which is to get repair estimates and talk to your agent. If damage is minor, err on the side of caution and pay for repairs out of pocket if possible, especially if costs are under or close to your deductible.
Be aware that most claims affect premiums for five to seven years. Even if you only file one claim in a five-year period, ultimately your rates may still increase. Many factors, not just your claims history, affect rate changes.
Don’t forget that you buy insurance to protect your possessions. If you have a serious loss, you may need to file a claim; that’s what it’s there for. Assess your options, discuss them with your agent and make a judgment call: Your home and possessions deserve the best protection.