The insurance industry has done a pretty decent job of educating the public that when you are involved in a car accident or if something happens to your house, you need to report the claim.
However, this education has weakened somewhat – statements are hot and heavy and sometimes frequent. Insurance companies in Ohio have pushed back with claims, increased deductibles and even cancellations due to frequency.
So insurance agents have changed focus and the push is to now train WHEN a situation motivates the claim to be made (if at all). Because insurance was never intended for maintenance – it was intended for disasters. And by filing multiple claims in a short amount of time, you jeopardize your existing insurance and damage your chances of getting future insurance (to a minimum you "I pay more for your insurance if you have many damages).
Here There are several situations where you should consider filing a claim:
- The damage to your property is simply more than you can pay out of pocket. If the damage is significant, chances are you simply do not have the money to pay for the repair itself. For example, you hit a deer and cause $ 4,000 in damage. An ordinary person usually does not sit that much in a bank account. So in this example, 9 times out of 10, you file a claim that the insurance company must pay so that you can fix your vehicle.
- There is damage to another party. Let's say you cause an accident and people in the other vehicle are injured. Or maybe you have visitors in your house and there is an injury Depending on the severity The damage is, you may simply not have the money to pay for this damage out of pocket.
- You will receive court papers. As soon as you receive these papers, you must contact your insurance company. When the legal process begins, it becomes VERY time sensitive and must follow a certain process. The insurance company has a complete legal team at its disposal and they know exactly how to respond to legal paperwork, the time frame for responding and so on. Many people do not think about this, but when you buy insurance you also buy access to legal representation. So let them do their job so you do not miss an important deadline, paperwork requirements or problems.
- When the damage exceeds your deductible. True story, we have had customers file $ 600 receivables when their deductible is $ 500. Although there is no hard and fast rule regarding the "right" amount, you should seriously consider paying out of pocket if the damage is only a few hundred more than the deductible. Save the insurance for the claim that you simply can not pay out of pocket (reference 1 above). It is intended for disasters, not for small claims.
And although we have heard many times "yes that is what insurance is for", no it is not. It is not designed to pay for every little thing that goes wrong. Again, this is not a maintenance policy, it's for big things.
Too many claims in too short a time become a frequency issue for insurance companies and they can do one of many possible things (Note that these are not mutually exclusive. A company may require a deductible increase and a coverage removal at the same time. Of course, cancellation is the last straw).
What Ohio Insurance Companies Can Do If You Have Too Much Damages
- Requires you to increase your deductible.
- Apply a damages claim. This surcharge results in additional premiums on your insurance and the premium remains on your insurance for a certain period of time (3, 5, 7 years? Varies depending on the company, but is usually longer than one year). So even though the claim may have been paid for too long, that fee remains.
- Remove the cover completely. For example, you have three claims for water backup in two years. The insurance company may require you to remove the water tightness.
- Cancel or renew for frequency. Please note that although options 1-3 may leave room for negotiation, cancellation is usually non-negotiable. And remember, if your insurance company has a problem with the frequency of claims, a NEW company will likely have a similar problem. This can mean problems with getting new homeowners insurance.
The lesson here? Discuss the situation with your insurance company / agent to decide if you want to file a claim or not. While the traditional advice was normally to submit the statement, things have changed! Small dollar claims or those that are barely more than the deductible should probably be paid out of pocket. This helps to prevent the insurance company from taking action due to the frequency of claims. Use your insurance for the intended purpose – the situation where you simply can not afford to pay out of pocket or if you are sued due to a claim. Let's handle yours (Ohio only). Call us at (937) 592-4871 or request a quote today!
P.S. For more useful information on insurance claims, check out these additional articles …
How Do Ohio Homeowners Insurance Claims?
Can I close my insurance claim after it has started?
How do accidents affect your car insurance?