In a recent report from InsuranceQuotes.com, Georgia homeowners only pay an average of 6 percent more for their homeowner’s insurance after making one claim. That puts Georgia among 18 states that are below the national average of 9 percent.
While on the surface this seems like a big relief, tread lightly down the path of filing claims. First of all, I recommend carrying higher deductibles on your policy to discourage turning in small claims. Most property insurance companies now have a minimum deductible of $1,000 on new policies going forward. The higher deductible also saves premium dollars over the years.
While there are many types of losses that are covered under a homeowner’s insurance policy, turning all of them in can lead to your policy being canceled. After the policy has been canceled, you’ll then be placed in a high risk pool for insurance, with a rate 3-5 times more than you are currently paying.
Let’s say you have a $500 deductible and a covered loss occurs. You get estimates from a licensed contractor and the damage total is $800. The insurance company will pay you the $300 after taking the deductible. Then let’s say a month later someone breaks into your home and takes $1,000 worth of personal property. The insurance company will pay you the $500 after taking your deductible.
They say bad luck comes in 3’s, and six months later a large tree falls onto your home and causes $15,000 in damage. The insurance company will pay you the $14,500 after taking the deductible, then will cancel your policy for being a high risk. Now, your $700 per year premium is going to be $3,500 per year for the next 5 years.
Now, if someone is trying to sue you or says you did something to cause them injury or damaged their property, by all means contact your agent/insurance company to turn that in. Failure to notify the insurance company in a timely manner after a liability loss can void the coverage of your policy and leave you paying out of pocket to defend yourself.
If a claim is going to cause you a financial hardship, by all means turn it in. If not, well be glad it was not worse and consider paying it out of pocket.
Remember, your homeowner’s insurance covers you in the event of property damage, storms, fire, theft, vandalism and liability, among other causes. In fact, if you’re wondering if you can file a claim with your insurance provider, I recently wrote a blog titled “What Your Home Insurance Covers… and What it Doesn’t”.
Do you have a question about making a claim? Comment below or give me a call at 678.587.3434.
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