Should I Claim it on My Homeowner’s Insurance?
Homeowner’s insurance is a risk assessment business and definitely something that you’ll want to have if anything goes wrong with your house. If you get a loan for your home, your lender will require it, so that they can protect their investment as much as you do and with cash purchases, it is not required, but highly recommended. But not everything that goes wrong with your house should be filed with the insurance carrier.
The most common homeowner’s insurance claims are for theft, roof replacement (hail damage in Texas), and water damage from busted plumbing. However, there are a multitude of potential claims that people make on a regular basis. While every insurance coverage is different, and every policy unique, here are some fast and easy pointers to remember:
- Insurance costs are based on risk. The age, condition, and features of your home can make a difference in what you pay as a premium. Which is more likely to need replacement, a twenty five year old roof or a two year old one? Brand new plumbing or plumbing that is fifty years old?
- Don’t forget about your deductible. The deductible is the amount you have to come out of pocket with before the insurance company starts chipping in their portion for the damage. If you have a $10,000 claim and a $4,000 deductible, the insurance company will only cut you a check for $6,000 to replace that $10,000 repair. Raise your deductible and your rate could go down. Lower your deductible and your rate could go up.
- Every claim called in direct to the insurance carrier, whether money is paid out or not, gets reported on your insurance file and could have implications for renewal rates or for new buyers when you go to sell. If your window gets busted by a runaway baseball, and you have a $2,000 deductible, chances are it’s not worth the call to insurance over a $250 window. But if the roof blows off your house and requires a $10,000 fix, that $2,000 deductible seems like it could be worth it.
- You could actually save up to 30% on homeowner’s insurance rates by bundling them with an auto policy by the same provider.
- Credit scores can impact insurance rates, particularly on auto, but also potentially on homeowner’s insurance too.
- Let your insurance company know about security features that could lower your rates or when major changes or updates are done to the home (plumbing, electrical, etc.). Other features to note are security system, fire hydrant location nearby, etc.
- If you have a special collection; art, guns, jewelry, fine furs, etc.; make sure to let your insurance carrier know so they can get the right kind and amount of coverage for those valuables.
- One of the best things you can do is find an insurance agent you trust to help walk you through all of these items. They’re a great resource and also a good point of contact on those “should I claim or not” moments before your account gets flagged.
image courtesy of Dan Diemer