If you are a homeowner, you pay insurance in case of an accident, right? The question you need to consider when losses happen, is “Should I report this claim or pay it out of pocket?” Most people may think that every time an accident happens, you automatically report the loss and ask for compensation, but this could be resulting in higher premiums or even cancellation. Find out why all homeowners losses don’t need reporting.
Considerations Why You Should Not Report a Loss
It may sound contradictory to pay for insurance but not use it, but there are some good reasons NOT to file a claim.
Claims History- Looking at your past claim’s history is a great way to predict the likelihood of future claims. If you don’t have any losses, many insurers will offer a discount and provide a lower premium than someone who has multiple claims found in his/her history. If you have experienced (and reported) more than 2 claims in 3 years, you are subject to a non-renewal, higher insurance premiums or even cancellation. Each time a homeowners claim is reported, the information is reported to a nationwide database referred to as Clue (Comprehensive Loss Underwriting Exchange) and your claims are being tracked for underwriting purposes.
Claim Frequency- Constantly filing claims is a sure sign your insurer will have serious reasons for non-renewal of your policy or even cancellation. This is not to say that you can’t report claims but keep in mind you will need to weigh the pros and cons of paying for the loss out of pocket or submitting a claim for payout which may mean a higher premium and likelihood of non-renewal.
Minimal Damages- If the damages to your home are minimal (slightly or less than the deductible amount) you should pay for the claim out of pocket and not report it.
Exclusions /Limitations- Sometimes you may not be aware of certain policy exclusions or limitations when it comes to a loss you have had. It is recommended you contact your local N.Y. independent insurance agent to decide whether it’s worth it to report the claim or assume the payment out of your own pocket. Sometimes with limitations, exclusions, and conditions, you may be faced with a loss that is valued below the deductible amount which in that case serves you no reason to report.
Neglect- Insurance is designed for covered losses, not failure to maintain your home. If the damages to your home are caused by neglect and failure to keep up the maintenance, your insurance claim will be denied anyway. Owning a home is a big investment so staying on top of maintenance issues will help to reduce the likelihood of claims.
Contact Us Today with Your Questions About Reporting/Not Reporting Homeowners Losses
Cameron Insurance Group is here for all your homeowners insurance needs and can assist you every step of the way. Always contact us first before filing any homeowners insurance claim. We can help determine whether it is in your best interest financially, so call us TODAY at 845-627-2130.