Should I File an Insurance Claim?
Before you file an insurance claim, it’s usually a good idea to talk to your insurance agent first. Even when your claim seems straightforward, you need to understand how it will affect your policy in the future. Continue reading to find out what you should ask your insurance agent.
What’s Your Deductible?
Double-check your deductible for that specific type of claim. Remember that some types of insurance policies have higher or lower deductibles for certain types of claims instead of always using your primary deductible. For example, auto glass claims often have a lower or no deductible, while home insurance policies might have a higher deductible for hurricane losses.
You need to know your deductible to see how much money you’d be able to get and if it would be worth filing a claim.
Will You Lose Discounts?
You may have discounts on your policy for having a claims-free history. Ask if you’d lose them and for how long. The discount you lose decreases the value of your claim payout.
Will Your Rates Increase?
Losing discounts isn’t the only way your premium might go up. The actual rate can also increase. Not all customers get the same rate. Instead, the insurance company calculates it based on your risk factors, including your past claims history. This may seem like two different ways of charging you for the same thing, but this is why you always need to compare the entire insurance policy when you’re comparing insurance quotes.
Keep in mind that not all rates increase your insurance premiums equally. As a general rule, you can expect higher rates for more claims and more severe claims. One minor claim might not increase your rates at all, but a few of the same type likely will. Even a single significant claim after years of no claims can lead to a substantial premium increase.
How Long Do Rate Increases Last?
Rate increases last as long as the insurance company considers the claim important. Many include claims from the last three to five years. Some go as far back as seven years. It might also depend on the type of claim. Once your claim is older than whatever cutoff the insurance company uses, your rates should go back down.
Does Switching Insurance Companies Help?
If an insurance company raises your rates, your natural reaction may be to shop around. The bad news is that insurance companies share their claims history, so you can’t switch insurance companies and have the new insurance company treat you as someone who has never filed a claim. The good news is that each insurance company has their own way of setting prices, so you could still find a lower quote somewhere else.
What Can Your Insurance Agent Do?
Your insurance agent works for you, not the insurance company. Your insurance agent can provide a neutral source of information to help you decide if it’s worth filing a claim and how to get the best price on insurance afterward. Burstad Insurance has insurance agents ready to help you in Menomonie, WI, with additional locations in Chippewa Falls, Medford, River Falls, and New Richmond, WI. Contact us now to get help deciding what to do with your claim.
