Home insurance provides property owners with peace of mind. They know that should their house or belongings become damaged or lost, their policy will make restitution. However, some first-time homeowners file claims too often. While the provider can simply deny them, having too many claims may cause financial challenges later. To keep your premiums low and your insurance secured, consult the guide below. 

Why Should You Strategically File Your Claims? 

Every home insurance provider maintains a Comprehensive Loss Underwriting Exchange (CLUE) report. It includes up to seven years of claims and helps the provider measure risk. An abundance of claims increases the perceived risk, resulting in higher premiums. The hike can even occur if the claim was accepted and covered by the insurance company. 

It's rare for an insurer to state when they'll renew the policy. If homeowners file too many claims, the company may decide to withdraw their coverage to minimize their risk. Those who are dropped from their insurance will have a challenging time finding another provider. Once they do, their premiums will become higher. 

By filing fewer claims, homeowners are considered a lower risk, and may potentially entitle them to discounts. 

When Should You Not File a Claim? 

Simple repairs, like a broken window or lock, should come out-of-pocket.

Basic upkeep is also the homeowner’s purview. Providers don't cover preventable wear and tear. The claim will be denied and essentially wasted, as it may increase your risk. 

Insurance underwriters have found that the average homeowner files one claim every 10 years. 

When damage to the home occurs, consider the insurance deductible. If the deductible is lower than the cost of repairing or replacing, it's best to pay out-of-pocket. Even if the amount is somewhat greater than the deductible, it might be more cost-effective to pay for it personally. It may be cheaper than incurring higher premiums over time. Since every situation differs, it's best to reach out to an insurance agent for assistance. 

Also, check your records for the date of the last claim. If it occurred within the previous three years, another would increase your perceived risk. 

When Should You File a Claim? 

If there hasn't been a claim in the last three years, filing one now shouldn't be an issue. Save the claims for significant damage, like fires or natural disasters. When the cost of repairing or replacing is substantially more than the deductible, the provider will understand why the claim was filed. 

Since it can be difficult for first-time homeowners to judge when to file a claim, it's best to consult an insurance agent before making a decision. For over 30 years, the residents of Scottsboro, AL, have relied on Goggans Insurance. They provide comprehensive insurance plans from top providers, including Nationwide® and Progressive®. As an independent agency, they'll find the customized plan you need without breaking your budget. For more information on their home insurance coverage options, visit their website. To schedule an appointment, call them at (256) 574-3440.