If you’re thinking about filing an insurance claim, you might have someone telling you it’s not worth it. What are they talking about when you paid your premiums to be able to make a claim? Keep reading to find out.
Why Someone Would Tell You Not to Make an Insurance Claim
There are three reasons why someone might tell you not to make an insurance claim. They’re all valid reasons, but they don’t apply in all situations.
The Claim Isn’t Worth Your Time
Let’s say you back your car into a light pole and get a $1,020 estimate from the body shop. If your deductible is $1,000, getting the remaining $20 from your insurance company might not be worth the time you’d spend on the phone and filling out forms. Where you draw the line, whether you wouldn’t file for $0.01 or $1,000 or somewhere in between, is simply a matter of your personal preference.
Your Rates Might Go Up
When you file a claim, your rates might go up. The insurance company isn’t exactly trying to make back what they paid, though. Instead, they’re calculating that because you already had a claim, it’s more likely that you’ll have a claim again. This math will depend on the type of claim. For hail damage to your house’s roof, you’d probably never see a rate increase unless your insurance company raised rates for your entire area. If you got cited for speeding that led to an accident, you can probably expect a hefty car insurance rate increase.
You can’t avoid increases by switching insurance companies. They all share claims history going back as long as seven years. However, each company has different guidelines for how far back they look and how they weight-specific types of claims, so you may still get a better rate if you shop around.
Your Policy Might Get Canceled
There’s truth to the risk of your policy getting canceled, but it’s probably not as high as most people think. As a general rule, the insurance company is only going to cancel your policy if you’re too risky to insure even if they raised your rates to account for the extra risk. That would be for things like filing more claims than almost any other customer or engaging in incredibly risky behavior that led to the claim. Unless you’re repeatedly filing frivolous claims, you should rarely worry about your policy getting canceled if you file a claim, because the situation would probably be severe enough that your insurance company would know about it to potentially cancel your coverage anyway.
What Can You Do Before You File a Claim?
If you’re not sure if you should file a claim, talk to your insurance agent. Remember, insurance agents are independent of your insurance company. Your insurance agent can help you understand how much your policy will pay and how much your rates may increase. Your insurance agent can also run quotes from other companies based on if you had or hadn’t filed the claim. To learn more or to get help, contact Bindford Insurance today.
