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Insurance Claim By Policyholders Often Yields An Increase Of Premium

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Insurance Claim By Policyholders Often Yields An Increase Of Premium

This BLOG On Insurance Claim By Policyholders Often Yields An Increase Of Premium Was UPDATED On October 23rd, 2018

If I have a claim will my insurance premium skyrocket?

  • Well that is a trick question
  • On the average I would say, yes
  • Let me talk to those whose premiums will go up and have gone up
  • On average the rates go up after an incident or accident occurring on or to your insured property, car, if you’re at fault
  • Every claim is different
  • The details of a particular claim will dictate whether or not insurance premium will go up
  • By how much? 
  • I will go over a few claims that have more probability of occurrence

Liability Insurance Claim And Effects On Premiums

Liability Insurance Claim, those in which you are found negligent for the cause of bodily injury or property damage to another, will likely increase insurance premiums:

  • An at-fault accident on your car insurance, or a “slip and fall” on your property, which would be covered by your homeowners insurance will raise insurance premiums
  • Homeowners insurance can be tricky
  • When it comes to property damage to your own vehicle and/or home that is not your fault, premium may or may not go up depending on the circumstances

Insurance Broker Versus Captive Agents

Here are some reasons why insurance premiums may also increase:

  • The type of insurer you are currently with and the type of claim are the two main factors
  • Although it can be said your age and history with your company may play a role in the increase as well

If you are with a standard or preferred carrier (they don’t typically insure people with claims), you can expect to pay a hefty increase for your insurance.

  • Additionally, if you file a minor claim (dollar wise) versus a major claim, premium increase may not be as much, maybe a few hundred or less
  • The younger (or older) you are when you file a claim, the more you can expect to pay for your insurance
  • If you have driven accident free for 15 years and file a claim, the insurance company may not see you as a higher risk

However, if you file a claim 10 months after receiving your license, the insurers will determine you are much more risky to insure and charge you much more upon renewal.

The previously mentioned reasons are given to insurance consumers.

  • Most people can’t name 7 top insurance companies
  • They don’t know how to find better options
  • Often they are stuck in the hole of underprivileged insurance premiums or in other words:
    • most insurance consumers are stuck paying too much for insurance policies
    • many dealing with commission chasing agents who don’t care
  • Key is to shop for insurance by consulting with several companies

Will Insurance Claims Skyrocket My Premiums?

Again to answer the question “will my premiums skyrocket if I have a claim?” the answer is maybe!

  • The national insurance companies with large television advertising budgets don’t usually have the best prices
  • They rely on bombarding us with commercials and other advertising to convince us they are the best option
  • How do you think they pay for an advertisement to be run at every commercial break on every channel 24 hours per day?
  • They’re using your premium dollars to do so after they jack up your premiums

When consumers understand economics and the law of supply and demand consumers will get a grasp on how insurance works.  By shopping with various insurance companies, consumers will find an agent with excellent insurance services, premiums, and coverage! If homeowners gets their homeowners insurance dropped due to insurance claim, lenders will forced placed homeowners insurance which is extremely expensive.

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