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Does homeowners insurance go up after a claim?

Does Homeowners Insurance Go Up After A Claim?

Yes. Your rates will increase after you file a claim. You might think that filing a claim may be the best option when your home has suffered damages caused by flood, fire, theft, and calamities. However, you have to think of how your claim might affect your home insurance in the long run because filing one will raise your premiums.

You might also think that you don’t have to hesitate to file a claim since you’re paying for it, however, sometimes it’s better for you to not make a claim. But, why? Isn’t home insurance supposed to be your protection? Yes, home insurance will protect you, but it doesn’t mean that you need to file a claim on every damage your house sustains.

How high will it become?

Filing a single claim can make your premium rates higher and can increase up to 10% on your first claim. Filing for the second time can increase your insurance rates even more and can go up to 20%.

A study from InsuranceQuotes stated that premiums can increase up to 32% when you file a single claim, depending on your state. If you’re living in California, your rates will have an increase of 18% when you file a claim once and a 24.9% increase will happen when you file for the second time.

Some states are tightening their regulations when it comes to raised premiums. In Texas, the law prohibits insurance companies to increase premiums when homeowners file a claim for the first time. The size or the amount of your claim has a little impact on your home insurance rates. The type of claim and the state where you live are the factors that you should consider when you make a claim since each state has different laws about increased premiums.

What kind of claims can make my rates go up?

You’ll pay a lot more in the future through raised home insurance rates if you make small claims such as water damage because of leaky pipes, stolen appliances, or a broken window rather than filing a claim for major damages such as fire or flood.

Liability-related claims will have the biggest impact on your rates. Personal injury, slips and falls, dog bites, mold, and water damage are some of the claims that can make your premium rates increase. These claims can also cause your insurance policy to get canceled. Theft and vandalism will also have a big impact on your premium rates because these events are crime risks and can occur again.

Final Thoughts

To prevent your rates from increasing, we advise that you only use your home insurance for natural catastrophes. Check and correct any false information about your previous claims in your Comprehensive Loss Underwriting Exchange or CLUE report if there’s any, and think thoroughly if you really need to file a claim for the second time. In determining if your rates will go up, there are many factors to consider. What you need to do is read and understand your home insurance policy thoroughly so you can decide whether you should file a claim or not.

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