How Claims Impact Homeowner’s Insurance Rates

Protecting Your Home

One reason we all have insurance is to protect ourselves against financial loss. Should something happen, our property will be repaired and back to the way it was before the claim. However, turning in every thing that happens to your home into your insurance carrier isn’t the wisest decision.

Anything that is turned in will show up as a claim filed on your homeowner’s insurance, even if nothing is paid out. The best approach when you think you may have a claim on your home insurance is to call and talk to your agent if possible. Some insurance carriers (such as Travelers) have a special department set up just to discuss potential claims, so you can talk it out before you turn in a claim.

When to Submit a Claim

In Texas, the deductible for most homeowners insurance policies is  1%. This means that you are responsible for 1% of the coverage A amount, Coverage A is the coverage for your dwelling. For example, if your home is insured for $500,000 your deductible would be $5,000.  You should only turn a claim into your insurance if the cost to repair your home is greater than your deductible.

Obviously if it’s a catastrophe, we do want to notify the carrier right away. But if it’s something such as small leak that you have stopped or potential damage from wind or hail, call your insurance agent and ask them to walk you through the steps before filing a claim.

You may also want to call a company such as Servpro. Servpro in Rowlett, TX is one of our trusted vendors in the agency. They can come to your home and remove the water. This can often be done for less than your deductible, so it can keep you from having to turn in a claim.

How Claims Impact Homeowner’s Insurance

The reason we don’t suggest turning in every small claim on your insurance is because we’re in a very hard market. This means it is getting more difficult to get insurance on your home. If you have multiple claims on your record that are small or didn’t pay out, an insurance carrier can deny you. That doesn’t necessarily seem fair, especially if it was a hail claim or something of that nature. But those are the rules. Of course, we want you to use your insurance – that’s why you have it! We just want you to be smart about it, so you can have the best rates and not have hiccups down the road where you lose valuable coverage because you’ve filed too many claims. Call our office at (972) 285-0381 if you have any additional questions.