When accidents happen, you have to ask yourself one question: Should I file a claim? There are many reasons for and against filing a claim against your coverage, but only one choice is the right one for your situation. Before you decide, continue reading to learn five important things you should know about filing new insurance claims.
1. One Claim Could Lead to Higher Rates
Your insurance company can take away a claims-free discount that you may have had on your policy when you make just a single claim. Considering a no-claims discount can take as much as 20 percent or more off your premiums, losing it could cost you hundreds more per year. If you already had previous claims on your record, you might also notice a new surcharge on your rates once your policy renews. Since insurers pay attention to your claims history for up to 3, 5, and sometimes even 7 years, the long-term cost of your higher premiums could quickly eclipse any savings you had when you filed your claim. As your independent agent, we can show you how saving on a claim today could affect you in the future and help you determine if the value of your loss justifies years of higher insurance costs.
2. The Type and Number of Claims Matter More than the Amount of the Claim
Although every insurer measures risk in a different way, most are more concerned with the kind of claims you make and how many there are than the actual cost of those claims. If you have an active claims history, insurers might consider that an indication of your future claims behavior. Likewise, you could be more heavily penalized if you have claims that could be regarded as serious, such as a personal injury liability lawsuit. In some cases, insurers may even choose to cancel coverage for a driver or homeowner who is deemed too high-risk to continue to insure.
3. Your Claim Might Leave You with Nothing
There are times when filing a claim might leave you with little or nothing in the way of compensation. For example, if a shattered windshield will cost $500 to replace, but your comprehensive car insurance deductible is $500, your insurance will not pay for any of the expense. Instead, you will pay the entire bill out of pocket and still cope with the effects of a new claim on your record. By consulting with your independent agent, you could avoid making unnecessary claims that work against your best interests.
4. Some Claims are Always Necessary
If a guest falls down the stairs in your home, you should report it to your insurance company – even if that person seems to be unharmed. Sometimes, lawsuits are served weeks after an incident. If your insurer was not made aware of the incident when it happened, you might be on the hook for the damages.
5. Always Talk to Your Agent First
Never file a claim without talking with your independent agent first. Unlike purchasing coverage online, working with an independent agent means you get personalized advice unique to your needs and situation. Here at Mid-Rivers Insurance, we can help you determine whether filing a claim is the right decision for you given your existing claims history, the type of claim you wish to file, your deductible, the value of your loss, and more. For more information or to request your free quote, call us today. We look forward to serving you soon.
