Will your insurance rates increase after a fender-bender? Are you at risk of losing your coverage if you file a claim for roof damage? These are the types of questions many homeowners and drivers ask when they experience a covered loss. The answer to these and other related questions comes down to the fact that every situation is different, and insurers consider many different factors when it comes to the details of your coverage. At Pagel & Associates Insurance Agency want to help you better understand how filing a claim can affect your insurance and what you can do to protect yourself against rate hikes and cancellations.
The first thing many people think about after an accident is how much their insurance premiums are going to rise after filing a claim. While it is true that a claim can trigger a rate increase, the amount of any increase will depend on many different factors, including:
- the insurer
- your claims history
- the type of policy you have
- the type of claim you need to make
- the cost of the claim
- and more
Often, it is the number of recent claims – usually within the previous 3, 5, or 7 years – that makes the biggest impact on the price you pay for coverage. Some insurers may offer ‘forgiveness’ for a first-time claim, but you could still be at risk of losing any claims-free discounts you are currently enjoying. In cases where a driver or homeowner has multiple claims in a short period of time, it is possible that the policy may be canceled or flagged for non-renewal at the end of its term.
Do the Deductible Math
Your deductible is the amount you pay out of pocket toward the cost of claims involving personal losses. For your vehicle, it could be a few hundred dollars. For your home, it could be thousands. Regardless of whether you are filing a claim for a replacement window, roof, or the entire house, your deductible will likely be the same. Before you file a claim, consider how much your insurance will reimburse you for your loss after consideration of the cost of your deductible. Be sure to take into account coverage limitations on non-itemized assets, such as fine jewelry and expensive collections. If the difference between your deductible and the loss valuation is small, it might not be worth the higher premiums to file a claim. If the loss valuation is less than your deductible, you will likely have to pay the entire claim out of pocket and still deal with the repercussions of a new claim on your record.
Should I File a Claim?
At the end of the day, filing a claim may still be in your best interests. In those cases, you should take full advantage of your policy knowing that any future premium increases are insignificant in the shadow of your financial loss. Never hesitate to claim significant damages to your personal property or belongings due to a covered event. You should also be quick to report to your insurer any incidents in which you could be held liable for another person’s property damage or injuries. Liability insurance can cover medical bills and protect you from expensive lawsuits that you might otherwise be responsible for if you fail to report an accident.
Here at Pagel & Associates Insurance Agency, we can help our customers determine whether filing a claim is the right decision given their individual circumstances. Our services go far beyond what is available from a website. As a hometown independent agency, our goal is to serve our customers as best as we can with their interests – not the insurers – in mind. If you are not yet a customer of Pagel & Associates, contact us today to find out more about our services and request your free quote. We look forward to serving you soon.