The purpose of buying homeowner’s insurance is to protect your home in the event that it becomes unexpectedly damaged. Fortunately, most of us never need to file a claim. Yet, what happens if your home is damaged and you do need to file a claim? Will it have a major impact on your insurance rates? Will your premium automatically increase, or worse yet, could your insurance company drop you completely?
Your standard homeowners insurance policy includes four types of coverage:
There are several additional insurance options that can be added to your homeowners policy to meet your specific needs. Here in the Louisville, Kentucky metro area, the agents at Foundation Insurance Group, located in St. Matthews, will answer all your questions and concerns and help you understand your options. As an Erie Insurance independent agency, they know what’s covered and what can be added, and make sure your homeowners insurance policy protects you and your property and does not have any exposures.
Insurance companies are designed to help people work through accidents in the most financially sound way possible. While there are no set guidelines as to what will cause your insurance premium to increase, most insurance companies will not raise the rates just because of one legitimate claim to the homeowners policy, especially if it is weather related. For example, if a tornado rips through your home, most insurance companies realize that the homeowner could not have taken any action to prevent the damage from happening.
Homeowners insurance premiums focus on the region that you live in, the number of catastrophes your area has suffered, and the type of home you have. This is how your risk is assessed and the factors that determine how much your premium will be.
Just because one claim doesn’t cause your premium to increase doesn’t mean that you can or should continue making claims. For example, insurance companies will become concerned if you file a claim for a burst pipe that floods and ruins your finished basement, and then file a similar claim later because you didn’t make the necessary repairs. For many insurance companies, reporting three claims in a year is enough to be dropped from the policy altogether. If this happens, you may have no choice but to purchase high-risk insurance. So, before you submit any claim, big or small, be sure to weigh all of your options, as multiple claims will have an effect on your premium and your policy.
Keep in mind that the type of claim will also affect whether or not your homeowner’s policy premiums increase. If siding blows off your home during a storm, this claim will be treated differently than something you have more control over, such as a dog bite or personal injury from slipping and falling on an icy or snow covered walkway.
The good news is that you don’t have to wait to be surprised. Use your insurance professional as a resource. Talk to your agent now about what your policy covers and doesn’t cover, your deductible, additional coverages you may need, and the types of claims you may want to consider taking care of out of pocket. Do your homework and be familiar with industry practices so that you know the best steps to take if or when disaster strikes.
As an Erie Insurance agency in St Matthews, Kentucky, our agents always take the time to answer your homeowner insurance claims questions. We will thoroughly explain your homeowners insurance coverage and review the claims process, if necessary. Contact Foundation Insurance Group for a policy review. We’re always here to help.