The Real Cost of Filing a Homeowner’s Insurance Claim
Here’s an easy way to make your homeowner’s insurance more expensive: File a claim.
A new analysis by InsuranceQuotes.com finds that a single claim can hike up your homeowner’s insurance an average of 9 percent per year, which can amount to hundreds of dollars. Two claims increase your insurance an average of 20 percent per year – though increases depend on many factors, including your location and the type of claim you file.
Related: A Quick Way to Save Big on Your Insurance
“Homeowners need to be really careful when filing claims,” InsuranceQuotes.com senior analyst Laura Adams said in a statement. “Even a denied claim can cause your premium to go up. Make sure you know your policy’s specific guidelines and only file a claim when absolutely necessary.”
Liability claims have the biggest impact on premiums – they push them up an average of 14 percent. (Fire, theft and vandalism claims are all tied for the next biggest impact, at 13 percent.) Medical and weather claims were the cheapest, increasing premiums just 2 percent. The average homeowner’s insurance costs $978 per year, according to the National Association of Insurance Commissioners.
The impact of a claim varies by state, with one claim pushing premiums up an average 32 percent in Wyoming – but just two percent in New York and Florida. In Texas, however, insurers are not allowed to increase premiums after one claim. That’s a result of the Lone Star State tightening regulations for how insurance companies can raise premiums after a consumer files just one claim.
Overall, premiums in 37 states and in Washington, D.C., went up an average of 10 percent or more after people filed a single claim, the study found.
One way to offset a premium hike is to raise your deductible. Increasing your deductible from $500 to $1,000 could shave a full 25 percent off your premiums, according to the Insurance Information Institute. It’s also worth shopping around every few years to see if other insurers will offer you better rates.
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