5 Times It Doesn't Pay To File a Homeowner's Insurance Claim
Great insurance policies help homeowners sleep better at night. If something bad happens, at least you can call your insurance company, right?
Unfortunately, not being careful with your homeowner's insurance claims could turn a real-life disaster into a financial catastrophe. Submit too many claims? Your premiums might rise. Submit the wrong claim? Again, your premiums might rise—and you'll still have to cover the cost of the damage.
Here are five scenarios that might end up costing you.
1. When the cost is within 20% of your deductible
Don't treat your homeowner's insurance deductible like your medical insurance deductible. Just because your insurance company will cover part of the cost doesn't mean you want it to do so. So if your deductible is $2,000, don't submit anything to your insurance if it costs less than $2,400.Submitting multiple small claims may ultimately make you "uninsurable," and you might see higher premiums.
2. When it was avoidable
Think about this from the insurer's perspective: Would better locks or a different property location have thwarted the thief who stole your television? Would a newer stove or frequent maintenance have prevented that kitchen fire? Theft and fire claims are going to increase your premiums.
3. When you are responsible
If the damage is due to your lack of maintenance, your claim may be denied, Even if your claim is denied, it's still noted on the Comprehensive Loss Underwriting Exchange which means that it can affect your premiums.
4. When your local agent tells you not to file
Having a local insurance agent can be a lifesaver. They can save you the trouble of filing a claim. They can call your insurance company without giving your name and policy number- to inquire about the chances of your claim being denied.
5. When there aren't long-term home repercussions
Figuring out which insurance claims are worth making can be a tricky business. Knowing how best to evaluate a problem—and understanding whom to call if you can't make a decision—will prevent you from paying more in homeowner's insurance costs over the long run.