When Should You File a Claim on Your Homeowners Insurance?

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A homeowners insurance policy offers protection against many unexpected events that cause damages or loss to your property. But when something unexpected happens, you might be left wondering whether filing a claim is the best thing to do.

Keep reading for money expert Clark Howard’s advice on when to file a homeowners insurance claim and other considerations, including:

Clark Howard’s Thoughts on Filing Homeowners Insurance Claims

Homeowners insurance offers protection against so many things! Covered losses can range from something less costly (like replacing a laptop that’s been stolen from your car) to five figures worth of repairs (like structural damage to your home after a bad storm). But just because something is covered doesn’t mean that you should rush to file a claim.

“I’m going to say something that’s going to sound like heresy,” Clark says. “You need to think through whether it’s a good idea to make a claim. Because insurers will treat you like dirt once you’ve had a claim. They may cancel you at your next renewal.”

With this in mind, Clark says you should consider putting roadblocks in your path to lessen the likelihood that you’ll file a claim.

“It’s a really classless act of so many insurers when the chips are down — no matter how they advertise — that they’re not there for you,” Clark warns. “So, knowing that’s how the game is played, be careful.”

The Cons of Filing Homeowners Insurance Claims

Clark recommends only filing a claim in the event of a significant and serious loss. Of course, you’ll have to decide how you define such a loss. But generally, it’s better to avoid filing a claim if you can afford the cost of repairing or replacing any damaged property on your own.

“I want you to think about — at your next renewal — raising your deductible as high as your insurer or your mortgage holder will permit you,” Clark says. “That way you don’t even think about making small claims, and you’re also in a position where you get lower premiums because you have that higher deductible.”

We hope you’re never in a situation where you need to file a claim. In such a situation, the cons of filing likely won’t outweigh the benefits. But if you’re on the fence about whether to file or not, consider some of the downsides:

Your Premium Might Increase

Once you file a claim, there are many factors that impact whether your premiums will increase or not. Your insurance company will consider the cost of the claim, the type of claim and whether you have any previous claims. Where you live also plays a role since insurance companies are regulated at the state level.

Your Policy Might Not Be Renewed

As you get closer to your policy’s renewal date, you might be surprised by a letter of non-renewal. Insurance companies use many factors to decide how risky you are as a customer. Filing a claim makes you seem riskier to companies. So, filing a claim is among the many reasons why an insurance company may decide not to renew your policy.


“A lot of insurers’ philosophy is if somebody uses their coverage, they don’t want them anymore as a customer. And then it’s a double whammy because other insurers…either won’t want you or will dramatically surcharge your premiums to take you because you had a claim — no matter how small it may be.”

Your Claim Might Go on Your C.L.U.E. Report

The Comprehensive Loss Underwriting Exchange (C.L.U.E.) is a shared database that more than 96% of insurance companies use to keep track of claims. Once you file a claim, it’s very likely that the details will go on your C.L.U.E. report. You can read all about how insurance companies use your C.L.U.E. report here.

Put simply, claims you file can stay on your record for up to seven years after filing. But your insurer isn’t the only one tracking your claims there. Once you file a claim, every other insurance company that uses the database will be able to see that claim.

So, let’s say you file a claim. Your insurer might decide to drop you when your policy ends. Or if they don’t drop you, they’ll likely raise your premiums. And if you shop around for lower rates, guess what?

Other insurers treat your claims history as a red flag. They may refuse to underwrite insurance for you or use your C.L.U.E. report to justify higher premiums.

Final Thoughts

Homeowners insurance is meant to provide protection against unexpected events, but you shouldn’t rush to file a claim every time something goes wrong.

“The more you can self-absorb instead of making a claim,” the consumer champ says, “the better off you’ll be.”

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