Storm season is upon us and with a vengeance in many parts of the country.  The average homeowner submits a claim once in 11 years. When the storms find our house, we are faced with the question of whether we should file a claim or not. Will it affect my rates?  Will the insurance company cancel my coverage if I file a claim?  These are fair questions and not easily answered in one word.

If you feel you have damage, make a list of the items in question and call your insurance agent.  It is best to call your agent first, not the insurance company.   Some insurance companies are required to file a claim if they have knowledge of the incident.  Ask your professional agent if he or she can give you advice before making the decision to file.  If there is any injury involved, it is wise to go ahead and file a claim in order to protect yourself from further liability.

In addition to your agent, a quality contractor can be a great asset.  They can estimate how much damage you have before you make the decision.  Get more than one estimate from qualified contractors with a good business record.  Ask for referrals and follow up with them to make sure the firm is reputable.  Many insurance agents can guide you in the process of locating quality contractors so that you are not just choosing one blindly from the phone book.

You pay good money for your insurance and it is certainly there for you to use.  BUT… all homeowner claims go against your record and if you have too many claims within a 3-5 year period, your policy could be cancelled.  Any claim could potentially cause your premiums to increase for the next 3 years.  As a rule of thumb, if the potential damage is less than your deductible, you should not file a claim in most instances.  If the potential damage exceeds your deductible, then you can weigh the potential benefit against the increased cost of insurance.  Your agent can be a great asset in helping you determine if it would be in your best interest to file a claim but the decision to file or not is ALWAYS yours.

Claims are reported to a central database called CLUE, short for Comprehensive Loss Underwriting Exchange.  Virtually all insurance carriers use CLUE in determining if they can offer you a homeowner’s policy and if they will add surcharged fees to your rate because of claims.  Some carriers may drop your coverage after just one or 2 claims.  If you have more than 2 claims in a 3 year period, you may not qualify for coverage with ANY preferred carrier.  This would mean much higher premiums and possibly less coverage on your policy as well.

The process can certainly appear daunting but your professional insurance agent can help you make the decision on whether to file much easier.