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Fire & Water - Cleanup & Restoration

Will Filing a Claim Raise Your Homeowners Insurance Rates?

2/28/2020 (Permalink)

Document of Homeowners Insurance Policy The primary purpose of homeowners insurance is to protect homeowners against catastrophic losses

Will Filing a Claim Raise Your Homeowners Insurance Rates?

The primary purpose of homeowners insurance is to protect homeowners against catastrophic losses, however, most insurance policies also offer coverage for smaller claims. Filing an insurance claim can sometimes result in your insurance company charging you a higher rate or declining to renew your policy. For these reasons, it is important to know when a claim might cause your rates to increase.

1. You Have Filed Previous Claims on Your Current Policy
The number of claims you have filed can have a big impact on if your rates will increase and by how much. According to a CNN report, filing a single homeowner's claim can cause an average rate increase of 9%, however, that figure can increase to as much as 20% if you file a second claim too close to the first. You may want to speak with your insurance professional in Baton Rouge, LA, to find out what your insurance company's policy is.

2. You Have Filed Claims on Your Prior Policy
Filing an insurance claim too many times can cause an insurance company to decline to renew your policy. It can also cost you more money when you get insurance with someone else. Customers who file a lot of claims are considered higher risk by underwriters and if they will write your coverage at all, they might charge you a higher rate.

3. You Have Filed Previous High-Risk Claims
Certain types of claims tend to have a more dramatic effect on your rates when you file more than one. Fire, liability, theft and water damage claims tend to result in the highest rate increases.
If a home flood or other event has caused damage to your home, you may be wondering if filing an insurance claim will raise your rates. The answer depends on the policies of your insurance company, but in general, it can be best to only use your insurance to cover large losses and to handle the small stuff yourself. Whether you use your insurance or not, failing to repair water damage promptly can lead to more damage, so you may want to contact a water remediation professional.

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