By Henry Margossian, Alliance Public Adjusters
You pay a yearly premium to cover your major investment against damages to your property. However, you need to think twice before calling your insurance carrier or your agent when you have a claim.
Most people approach claims with the notion of “I paid for it, so I will use it.” In recent years, natural disasters are occurring more frequently and at a larger scale, which leaves you with three problems: policy cancellations, increasing premiums, and difficulty purchasing a new policy from another carrier.
There is no specific dollar threshold that dictates if a claim should be filed or not, but from our experience, the first question to ask is, how much is your deductible?
There are too many other factors to list them all; however, a few important ones are the following:
- How many claims have you filed in the past 2-3 years?
- Is the damage caused by poor maintenance and upkeep?
- Is the damage a long term issue?
A few weeks ago, I inspected a home after the claim was filed only to find out that the deductible was $5000, and the claim was worth less than $11,000. Had the client consulted with us prior to filing the claim, my advice would have been to avoid it. Of course, the client is still free to file a claim if they choose to, though you must make sure you don’t move one step forward then two steps back.
Every time a claim is filed, the information is noted in a database and that database is used by all carriers for underwriting new and renewal business. In most cases, the records stay for seven years and sometimes longer. Regardless if the claim was caused by your fault (unintentionally) or if it happened by accident, the claim is in your record and now you have become a high-risk customer.
Sure, if you don’t pursue the claim with your insurance carrier, there will be zero payout; and if it just happens that your home has recently been added to a brush fire zone, odds of your premium going higher is inevitable. It could also be that your carrier has stopped writing new business in your zip code.
Every claim is unique, even if the cause of the loss is the same. Next time you think your home has sustained smoke damage from a brush fire or you have had a leak in the plumbing, please call us before you file a claim for a free consultation or in person visit. We will review your policy for property coverages and limits, assess the damage, and provide you with our expert advice.