Many people believe that having one claim filed with their homeowner’s insurance will cause their rate to go up. Think about auto insurance, for instance, if you file a claim after a car accident, your premium might increase. Thankfully, homeowner’s insurance does not act like auto insurance. Filing a single claim will NOT cause your homeowner’s premium to increase.
Your homeowner’s insurance premium is determined on many factors, such as:
- Geographical location of the home
- Age and construction of the home
- The number of disasters the area has suffered in the past few years, such as tornadoes and extreme storms
- Potential risks in the area, such as burglaries or theft
- Amount of coverage
- History of filing multiple claims
- Poor credit history
Filing one claim will not increase your premium. Insurance companies are more concerned with how frequently your neighbors or people in your zip code file claims. If you live in an area that is consistently burglarized or prone to destructive storms, it may not matter if you have a clean claims history — if people around you do not, that may increase your premiums.
If you have significant damage to your home, the right thing to do is file a claim. After all, you are paying a premium yearly, why not use your insurance for what it is designed to do?