One of the most common questions I am frequented with is whether or not one of our clients should file a claim. This can apply to any line of business, but the most common one is definitely personal auto. This is where it gets hard-I can give you my opinion, but at the end of the day, it is the insured’s decision.
The first most basic principal that applies to whether or not you file is to know what your policy language says. Your policy language may require you to file a claim or notify them after any type of accident. In other words, if there’s any possibility that you or someone else could ask for payment from the insurance company, you have to notify the insurance company. Remember, at the end of the day your insurance is a contract and if the agreement is breached the worst they could do is cancel your contract. The other thing that insurance companies often do is refuse coverage if you initially didn’t file a claim and something comes up at a later point.
The purpose of insurance for consumers is to protect them from financial disaster, not small expenses. It is not wise to make small claims, although they disagree on what small means. To some that’s $500. Others say $1,000. It will depend on what you can afford to pay out of pocket and what your deductible is.
If you haven’t had recent claims, filing a single claim might have no effect on your premiums; A lot of companies are beginning to offer first-time accident forgiveness. This perk is a get-out-of-jail-free card that gives you a second chance. With some companies, you’re only eligible after you’ve been accident-free for a number of years. If your insurance has this feature, lean more toward filing a claim. Also, file a claim anytime injuries are involved. If there’s a chance someone else in the incident could claim they were injured, file a claim to protect yourself from an injury lawsuit.
Lastly, most insurance companies will say that your rates will not be effected due to weather related events i.e. hail, tornado, all those fun things we see in Oklahoma. In those instances it may be OK to file a claim without seeing your rates shoot up.
At the end of the day, insurance is there to make your life easier. Claims are never fun to go through, but they will usually fall off between 3-5 years. If you have questions regarding your insurance, ask your current agent. If they can’t help, ECI is always here.
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