Avoiding Higher Insurance Rates When Filing Claims

7/29/2021 (Permalink)

If you experienced significant flooding, contact a local mitigation company.

It is not uncommon for homeowners to worry about their insurance rates after having to file an insurance claim because of sudden water damage or a home flood. Unfortunately, regardless of the reasoning for the claim or loss, a rate hike is always a possibility after filing. However, some considerations may limit or exacerbate your risks.

3 Considerations To Limit Or Exacerbate Your Insurance Rates

1. Filing Too Many Claims

While your insurance company is there to protect you against financial losses due to unpredicted damages, they still do not want to pay out more than they have to. If you are a client who continuously files claims, then the insurer will likely raise your rates to reduce their expenses. Every insurer uses algorithms to predict the average level of payouts for any given year or client; when a client surpasses those expectations, an insurer must make adjustments to protect other clients and their interests. Unfortunately, some policyholders who file too many claims may even lose their policy.

2. Purposeful or Neglectful Damage

If the damage to your property is a result of intentional damage or neglect, then your insurer will almost certainly raise your rate. An intentional incident that causes an insurance claim may cause your insurer to see you as a financial risk to the company.

3. Accidental Damage

Most insurers will not penalize a good client when damages are accidental or unpredictable, especially if they do not routinely file claims. When an accident occurs, your insurer will want you to work with an accredited mitigation company in North St. Paul, MN, and they will follow the process closely.

While it is natural to worry about rate hikes after water damage, you still may need to file an insurance claim for extensive damage. Water loss can be costly, and many homeowners cannot afford to go it alone. If you experienced significant flooding, contact a local mitigation company to find out more about the restoration process and how to work with your insurer.