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Will Insurance Claim Premiums Rise?


Will Insurance Claim Premiums Rise?Buying an insurance policy is something of a paradox unto itself. Generally speaking, insurance of all types is something that you purchase hoping that you never have to use it at all. You would never buy a car and just let it sit in the garage, hoping that the day never came where you would have to get behind the wheel, put the key in the ignition and go for a spin. Despite that, insurance is still necessary to have in the unfortunate event that you do need it the most. One of the most important factors that many people struggle with has to do with the claims process. People do not want to make an insurance claim at all because they are concerned that their premiums will go up. As with insurance as a concept, the answer is not necessarily straightforward.

Your Premium Will Change Over Time

For starters, you should never worry about filing an insurance claim because your rates might increase for one simple reason: your rates will likely increase whether you want them to or not. Many of the reasons why your rates might go up will have little to do with the claim in question.

One of the primary reasons why insurance rates might increase has to do with the age of the home in question. The older the home, the more liability there is for the insurance company to insure and financially protect that home. As your general sense of liability increases, so do your insurance premiums.

Natural disasters in surrounding areas can also increase your premiums. If your area has seen a rash of fires, floods, storms and other types of events that are beyond your control, your insurance company may look at you as statistically more likely to suffer from the same types of damage and increase your rates as a result.

Mass Claims Affect Premiums

Another reason why your rates might go up has to do with the amount of recent claims the company in question has been dealing with related to certain types of losses. Sometimes certain portions of your policy are designed to naturally get more expensive as homeowners in the surrounding area have made claims pertaining to one specific type of loss. If there has been a rash of burglaries in your area, for example, other homeowners may cause your rates to go up even if you have not been affected.

The point is that every insurance company is different regarding what events cause a premium to go up and what allows that money to remain unaffected.

It’s always a good idea to speak to your insurance agent. He or she will be more than happy to sit down with you, go over the specifics of your own personal policy and address any and all concerns that you may have.Will Insurance Claim Premiums Rise?

A lot of insurance agents will do just about anything to retain their customers. As a result, they may actually have significant pull in the decision about the way that your premiums might be altered after filing a claim. Though it is not a guarantee, talking to your provider about your concerns may be a way to allow your premium to remain the same even if a claim has taken place.

The most important thing to remember involves how serious the situation in question really is. Will the claim that you are filing exceed your deductible? If the answer is “yes”, then you do not need to make a claim. Can you afford to pay for the services that you need out of your own pocket in the event that it does exceed your deductible? If the answer is “no”, then the situation dictates that you should likely make a claim...

Money Bags & Coins

How much do Insurance Claims Costs?

How much do Insurance Claims Costs?People may be hesitant to file an insurance claim for a wide variety of different reasons. The most common reason is because that person feels that their insurance rates may go up to unaffordable levels due to even one small claim. The reality of the situation is that insurance claims are a natural part of the process and may be the only way to help get the money you need depending on the specifics of the situation. When it comes to filing an insurance claim and why the process is so important, one of the key things to understand is how much that claim is going to cost.

Insurance Claim Costs

When talking about homeowner’s insurance, the cost to file an insurance claim will depend very much on the specifics of the policy in question. The cost to the homeowner is dependent on two key things: individual policy limitations and deductible amounts.

Deductibles are the total amount of money that you have to pay out of pocket for a particular claim before your insurance will go into effect. These deductibles are made available to the homeowner well in advance and are typically agreed upon when signing up for insurance in the first place. The average deductible can range anywhere from $250 to $5000 or more depending on the policy. However, the most common are $500 or $1000.

Your deductible should play a factor in deciding when and if to make a claim. If you are filing for a loss of only $100, it may actually be more beneficial to you in the long run to just pay the money out of pocket and avoid filing the claim altogether. If you lose your home to a fire and suffer a total loss, on the other hand, even a deducible of $5000 or more will still pale in comparison to the amount of money that your homeowner’s insurance will pay out to replace all of your goods and belongings.

Insurance Caps

Some homeowner’s insurance policies also have specific caps on them for certain types of losses. If the type of loss that you have incurred falls into one of these pre-defined areas, you may not necessarily get all of the money you need to rectify the situation – even if your homeowner’s insurance policy is valued at much more.

Mold remediation, for example, is usually capped at $0, $5000 or $10000. If you suffer $20000 worth of damages, have a one million dollar homeowner’s insurance policy but a $10000 cap on mold remediation, you would only receive the capped amount of money and not a dollar more.How much do Insurance Claims Costs?

Sewer drain backups are also a common category that are usually capped by insurance providers. These are sometimes (but not necessarily always) capped at values like $1000, $5000 or $10000.

If these types of situations are of serious concern to you, it may be worth looking into a different policy that will provide a larger amount of coverage in the event that these types of situations do occur.

Deductible Costs

Most of the time, however, the homeowner will only be responsible for the cost of the deductible. If you suffer one million dollars worth of damage and have a two million dollar homeowner’s insurance policy with a $5000 deductible, you will only have to pay $5000 to completely replace your home in the event that the disaster fell into an uncapped situation. Your homeowner’s insurance will take care of the rest.

As it relates to pricing for the actual project, restoration companies are required to use a price list called Xactimate. This price list helps ensure that restoration companies are following a “fair” price list that is approved by all insurance companies. The scope of work may vary slightly from restoration company to restoration company, however the line item prices should always be the same. It is important to keep in mind that every project is going to be different and a “baseline” quote cannot be provided on the phone. The job must be assessed by a technician before any kind of pricing can be providedExternal Link:..

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What are the benefits of Insurance Claims?

Many people are hesitant to file insurance claims for a wide variety of different reasons, even when it is the most best and logical step to take in a particular situation. Some people don’t want to deal with the sometimes lengthy and involved process of filing a claim in the first place and dealing with an insurance adjuster after they’ve already dealt with some type of disaster. Others are afraid that their insurance premiums will go up. Despite these very real issues, filing an insurance claim still brings with it a wide variety of different benefits that cannot be ignored.

Benefit:  The job gets done right

One of the biggest benefits of filing an insurance claim comes by way of the fact that it allows a restoration company to do their job 100% correctly thanks to having access to all of the funds required given the situation. The issue of “cost” is not a concern at all, as your insurance company is paying for the issue – regardless of the extent of the damage that you saw.What are the benefits of Insurance Claims?

Along the same lines, another benefit is that making a claim allows a restoration company to adhere to all standards that need to be followed given a situation. Not only do local building codes need to be followed when all types of restorations are performed, for example, but there are also many safety standards that need to be followed to a proverbial “T.” These standards can easily be followed without a question of cost. For more information about restoration standards, see our “Restoration Standards” page on our website.

Benefit:  Financial means are not an issue

Another major benefit of filing an insurance claim is the peace of mind that only comes with knowing that the concern of both cost and exceeding a certain dollar amount is not an issue. If it costs $5000 to fix the issue that you’re experiencing, your insurance company has you covered thanks to the claim. The same is true of a $10,000 bill, a $20,000 bill or higher.

Many people also don’t realize that unexpected additional damages may be found during the mitigation and restoration process. Filing a claim brings with it the benefit that these types of unexpected issues can be adequately addressed without needing to both stop work and receive financial approval from the homeowner. If you’re paying for restoration services out of pocket, $5,000 in additional work can be a large issue. If the funds are coming from your insurance company, all of these unexpected issues can be addressed quickly and in the best way possible.

What are the benefits of Insurance Claims?Many times after suffering some type of disaster like a fire, homeowners are very concerned with the cost. If you’re paying for the cost of restoration out of your own pocket, restoration companies are essentially limited on the services that they can provide with the money that they have available to them. After filing an insurance claim, however, restoration companies can work to the fullest extent of their natural abilities without having to worry about these types of concerns.

At the end of the day, It is important to realize that a homeowner takes out an insurance policy for a reason. It is to insure against catastrophes. You pay premiums for your entire life to guard against situations exactly like these. It would be a shame not to use that resource if you have it available – some people aren’t so lucky...