Insurance Claims

To Claim or Not to Claim- That is the Question

Why do you have insurance? Insurance is designed to make you whole again in the case of a loss. That is the exact reason why you have insurance. But just because you file a claim, does that mean you will automatically be "made whole"? Quite often the answer is No. And on top of that, your rates will most likely go up because you filed that claim; even if the claim doesn't pay out. This can be so frustrating to an insured!

   There are several pieces to the claim puzzle that must come together before a carrier will pay out a claim. It is in your best interest to know those pieces before you make the decision to file a claim. If you don't have all of the claim puzzle pieces, your claim will not pay out. Now, you can complain and switch carriers, but chances are, it won't be any different with the next carrier. Here is what you need to know before you file a claim:

1. Is it a covered loss? Different policies cover different perils.

   Basic form policies cover fire/lightning, windstorm/hail, explosion, riots, aircraft, vehicles, smoke, vandalism and theft. 
   Broad form policies cover all of the basic perils, plus falling objects, weight of ice/snow, accidental discharge of water, cracking/burning, collapse, freezing and sudden electric current.
   Special form policies cover every peril except what is specifically excluded. 
What type of policy do you have?

2. What type of deductibles do you have? There are many options! 

     Your  home policy is most likely has a deductible that is a percentage of your dwelling value like 1%, 2% or higher. Your home policy can have a flat rate deductible instead, but this will cost more. There is a different deductible for your wind/hail claims and everything else (all other peril). If your dwelling value is $250,000 and you have a 1% deductible, you will pay the first $2,500 of any claim. 

3. Is it worth it to file that claim?

   So if you have a tree hit your house and it just damages a piece of your roof, chances are it will not cost $2,500 to repair a section of the roof. In this case, it makes no sense to file a claim. You will not receive any benefit from the carrier and your rates will go up at your next renewal because you filed a claim. On the other hand, if you have a fire and your entire kitchen has to be rebuilt, it will most likely cost more than $2,500. In this case, filing that claim would be to your benefit.  You will pay only $2,500 for repairs that could cost $10,000.

   There is quite a bit more that goes into if or how a claim is paid out. There are too many scenarios of what is and is not covered for me to try to explain the particulars here. Each claim, with each policy, with each carrier will be handled separately (and differently). When you make the decision whether or not to file a claim, examine these 3 things before you even consider making a phone call to the carrier. (Be aware- most carriers will file a claim after talking to you; even if you just called with an inquiry and never said the words, "I need to file a claim.") But if you have done your homework and you are going in with your eyes open at least your chances for a beneficial outcome increase! 

If you have any questions about your home, auto or business insurance, 
email Brockman Premier Insurance or call 877-987-8683 
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