When you have a loss that’s covered by insurance, you might want to pick up the phone to file your claim right away. Before you do, you should make sure that’s what will save you the most money. Keep reading to learn more about what you should consider.
Will You Lose Your Policy?
You’re rarely going to lose your policy because you filed an insurance claim, but it is a possibility. The insurance company will generally only cancel your policy for a very large loss, if you did something reckless or irresponsible, or if you have an excessive number of claims. Your insurance is there for you to use it.
Will Your Rates Go Up?
You may see a rate increase for as long as seven years after you file an insurance claim. It depends on how far back the insurance company looks. Some only go back three or five years instead of seven.
Any rate increase also depends on the type of claim. For your home insurance, a dog bite is more likely to lead to a higher increase than a hail claim, since you have more control over your dog than the weather. For auto insurance, you’ll typically see a much larger increase for an at-fault accident than a chipped windshield.
In addition to rate increases, you might lose discounts. This could be a direct discount for a claims-free history or losing a preferred status that was based in part on your claims history.
How Much Money Will You Get?
How much money you’ll get for the claim is also important to consider. If you need to rebuild your home after a disaster, you probably don’t care if your insurance rates go up or even if your policy gets canceled. If you have minor body damage on your car, it might not make sense to file a claim when you only get a few dollars after the insurance company subtracts your deductible.
Are You At Risk for Additional Losses?
You should also consider if you have a risk for future losses. For property damage claims, you can usually know the exact cost to repair or replace your property within a few days or weeks. For bodily injury or other liability claims, the full damages aren’t always clear from the beginning. In addition, the statute of limitations may give the other party months or years to sue you. However, your insurance claim deadline is usually measured in days. If you don’t report a covered incident when it happens, you may not be covered if you later find out you’re liable for much more than you thought.
What Can Your Insurance Agent Do?
Your insurance agent is independent of your insurance company and works for you. If you want a neutral assessment of whether you should file a claim, talk to your insurance agent. If you want to find out if you can get a better rate from a different insurance company based on your claims history, your insurance agent can help you get quotes. To learn more or to get started, talk to Myers Insurance Group today.
