When Should You File an Insurance Claim?

when to file an insurance claimAccidents, in the long run, start to become inevitable. Eventually something will happen, something that results in damage to your vehicle, home or business. And when it does you will be faced with several very important questions: should you submit a claim or not? What are the consequences of submitting a claim? How will your rates be affected?

The answers to these and similar questions help you to know whether or not submitting a claim will work out to your advantage. Of course everyone’s situation is different and it is always recommended you get advice from those you trust before moving forward. With that in mind, here are a few key guidelines to help you make your decision the next time you are thinking about submitting a claim to your insurance company.

It’s a Good Idea to File When…

If the claim is substantial, go for it. Consumers typically get insurance to help them guard against the financial ruin brought about by significant accidents. They are not looking to nickel and dime their insurance company through repeatedly filing for smaller occurrences. And besides doing so would be unwise for reasons we’ll address later.

If your insurance record is free of claims or you have not filed any claims recently, then doing so may be advisable. Filing a single claim when there is no recent history of claims runs a lower risk of increasing your insurance premiums.

If someone is injured in the accident, it is almost never a good idea to keep that to yourself. Even if the injury seems minor, the injured party can come back months or even years later and sue you. If you refused to file at the time of the accident, your insurance company can legally refuse to defend you and deny any payment to boot. Filing a claim in case of an injury protects yourself from both an injury lawsuit and a mountain of headache later.

It’s a Bad Idea to File When…

If your deductible, the amount you pay out-of-pocket before insurance picks up the bill, is higher than the value of your claim, there is no point in filing for one. For example, let’s say you suffer $800 worth of damage to your home and your deductible is $1,000. If you file a claim to your insurance for this loss, they are not going to pay anything, but you will carry that claim on your insurance for a significant amount of time. In this instance it is better for you to just pay out-of-pocket and not bother with the insurance company.

If you have filed any number of other relatively recent claims, filing again could literally cost you. The more claims present in your filing history, the greater the likelihood your rates will increase. So if you are faced with yet another claim, paying one of the smaller ones without tapping your insurance  could save you quite the sum.


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