Insurance offers protection against financial losses caused by covered events. A shopping cart dinged your paint job? You can claim it. Your laptop was stolen from your car? You can claim it. Wind damaged the roof to your home. You can definitely claim it. In fact, you can file a claim for just about anything you want, anytime you want.
However, just because you can file a claim, doesn’t mean it is a good idea. If you are thinking that an insurance claim is like payback for all those premiums you paid in, think again. While you should make a claim if you suffer a major loss after such a house fire or serious collision, smaller claims could end up costing you more in the long run. Continue reading to learn about three scenarios when filing a claim might not be such a good idea, as well as when it is.
1. Your Claim is Small and Only Involves You and Your Personal Property
When you are the only person who has suffered a loss, it pays to think twice about filing a claim – especially if the damages are minor. Collision, comprehensive, personal belongings, and structural damage protection on your auto and home insurance all come with a requirement that you be responsible for a deductible. That means you share in the cost of the repairing or replacement of the loss. If the total amount of your loss is not much more than the amount of your deductible, it is likely that you are better off covering the expense yourself and leave the insurance company out of it.
2. You Already Have a History of Recent Claims
The number of recent claims is a major consideration when insurance companies determine your eligibility and calculate your premium. In some cases, “recent claims” is as little as three years. In others, insurance companies could review your claims history for up to five years. If you have a claims history with two, three, or more claims on your record, filing a new claim could result in non-renewal or even cancellation of your policy. Fortunately, an independent agent can help you find coverage even with a history of multiple claims, but it could come at a price.
3. You are Concerned about Rising Rates
Perhaps you have a spotless claims history and your low rates reflect that fact. Your insurer has rewarded your safe driving habits and claims-free history with a preferred policy and a claims-free discount. Now that it’s time to file a claim, you worry about your premiums rising. Depending on the claim type and amount, you could see your premiums increase. Not to mention, the small claim you file today could continue to have an effect on the price you pay for coverage for years to come. In these scenarios, it pays to talk with your independent agent about how a particular claim could affect your future coverage and whether today’s savings are worth tomorrow’s costs.
“Should I File a Claim?” Always Talk with Your Agent
Always talk with your independent agent first before filing a claim – even if you think you already know what is best for your situation. There are times when filing a claim is absolutely necessary, such as when your home is burglarized during vacation or when you cause an accident that results in injury to another person. There are other times when the right decision is less obvious and requires the review of a licensed and experienced agent who is looking out for your best interests – not the insurer’s.
Don’t pay more later for a claim you wish you would not have made today. For more information about claims assistance or to find out more about the benefits of using an independent agent, contact our office today.