From fender benders and break-ins to fires and inclement weather, some of the most unexpected events in life are also the most expensive. If you have home, auto, or other types of insurance, it helps to know you are covered against losses and liabilities.
However, filing a claim might not always be in your best interest. Before you contact your insurer, continue reading to find out what you should consider before filing a claim on your insurance policy.
Your Claims-Free Discount
This is often the first thing to go after you file a claim. Claims-free discounts offer an extra percentage off your current premium. Even if your premium does not go up thanks to first-time accident forgiveness, you could still face higher costs with the elimination of the extra discount. In some cases, this could be as much as 10 to 15 percent or more of your premium.
Your Affordable Coverage
A small claim might not seem like a big deal at the time, but it could have long-lasting financial repercussions. Imagine finding out that the $600 claim you made last year is what caused your rates to rise by $75 per month. Sure, you may have initially saved a few hundred bucks minus your deductible, but you are paying for it now in the form of higher premiums. Worse, many insurers review claims that are up to 3, 5, or even 7 years old when deciding how much to charge for coverage.
Loss of Discounts
If you ever purchase coverage from a new insurer, expect your history to follow you. Most insurance companies report customer claims to consumer reporting agencies, which are accessible industry-wide. That means the claim you filed for an accident 2 years ago is likely to be visible to a new insurance company if you switch. One option in this scenario is to work with an independent agent. This allows you to view options from multiple insurers – not just one – when shopping for new coverage.
You purchase insurance to protect yourself from possible losses, but did you know your insurer can drop you if you make too many claims? In fact, the number of claims you make could have a bigger impact on your insurability than the amount of those claims.
Think twice before billing your insurer for the rock chip in your glass or the scratches on your paint job. If you already have a history of recent claims, you might be better served by paying for small damages out of pocket.
Here’s What You Can Do
If you are concerned that your next claim could result in unwanted financial consequences, remember that you are not alone in making your decision. Before you contact your insurance company, first contact your independent insurance agency for help and advice. Here at Tagge Insurance, we serve as your personal advocate, helping you better understand how the claims process works and how to navigate your policy. While some claims are absolutely necessary, there are others that could cost you more in the future.
We can help you determine whether to file a claim based on:
- The type of claim you are making
- Your claims history
- Your deductible
- The amount of your loss
- Your current premiums
- And more
If you do not yet have an independent agent, contact us to find out how working with one can expose you to a larger insurance market and help you keep more money in your pocket. For more information or to request your free quotes, contact our office today. We look forward to serving you soon.