Before filing a claim against your homeowners insurance, it’s important to understand how that claim might impact future premiums. While it’s common for claims to increase the premiums that homeowners in Vermont pay, specifically how a claim might impact your premium depends on several factors.
Will Filing an Insurance Claim Cause My Vermont Homeowners Insurance Premiums to Increase?
Not all homeowners insurance claims affect future premiums equally. While most will lead to an increase, the extent varies depending on the claim and your claims history.
Liability Claims: Expect higher liability premiums
Liability claims may result from an accident occurring on your property that results in a guest’s or other person’s injury. They also could arise if you have a dog that bites someone, are in a boating accident, or post something defamatory on social media.
Exactly what would be covered depends on your homeowners policy’s terms, but most policies include coverage for at least some incidents like these.
Filing a liability claim can have one of the largest impacts on future homeowners policy premiums. Most insurance companies will consider you more likely to file another liability claim if you’ve already filed one, and the lawsuits arising from covered incidents can be extremely expensive for insurance companies to pay.
Any increase in your rates is likely going to be limited to the personal liability coverage portion of a homeowners policy, but this is typically one of the more significant parts.
House-Specific Claims: Expect higher property coverage premiums
The property coverages of your homeowners policy usually protect your house, and possibly other structures, on the lot. Personal property coverage normally protects items kept at your residence.
Filing any property coverage claim for an incident that affects only your house will probably result in higher future property coverage premiums.
A house fire, burglary, vandalism, burst pipe (if covered) and similar events are considered specific to your place. Insurance companies frequently consider you more likely to have another incident like this if you’ve already experienced one.
Major Natural Disasters: Could see higher premiums regardless of whether you file
Major natural disasters that affect much of Vermont or New England can result in higher premiums for almost all homeowners in the affected region. These claims aren’t specific to you individually, but rather impact risk assessment for the entire affected area.
Because a natural disaster can increase the perceived risk of insuring homes in a region, your premiums may increase regardless of whether you file a claim after a storm or other natural disaster. Any increase is likely to be lower than the increases you’d see after a liability or house-specific claim, but you might see a small bump in your rate nonetheless.
Frequent Claims: Likely to see much bigger increases
One of the other major factors that insurance companies consider is how frequently you’re filing insurance claims.
Filing one claim periodically when there’s a major event probably won’t have too large an impact on your rates, although you should be prepared for some increase.
Filing two, three or more claims within a few months or years will likely result in especially high rate increases when your policy renews. Your insurer might even choose to not renew your policy if you’ve had too many claims.
Know when to file homeowners insurance claims in Vermont
Deciding whether to file a claim against your homeowners insurance requires understanding what you’d probably be paid for the claim, and also how the claim would probably impact your future rates. To better understand when you should and when you shouldn’t file a claim, talk with one of the independent Vermont insurance agents at Paige & Campbell Insurance.