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Friday, April 4, 2008

Claims that Boost Your Insurance Rates

Claims that Boost Your Insurance RatesI think everyone knows that certain insurance claims have a tendency to increase your premium. What are they? Here's a list from Bankrate on a few claims that will increase your homeowners insurance:

Bowen says that making two claims in a three-year period is more likely to trigger a hike, although each company is different.

Dog bites. A single attack is often likely to result in higher premiums.

Water damage. Water damage tends to set off a barrage of red lights for insurers, largely because of the costs of eliminating mold.

Slip-and-fall claims. Slip-and-fall injuries, according to the National Safety Council, are the single largest cause of emergency room visits. If someone hurts themselves on your property and files a claim with their insurance company, your rates may rise.

And here's what can raise your car insurance rates:

Factors that may be considered include whether you were driving while drunk, whether injuries incurred, and the severity and type of accident.

The piece advises only filing a claim when it's a major one. Here's the rationale they use in saying so:

It gets back to the notion of what insurance is all about: bailing you out from a large disaster, rather than the small things that annoy rather than harm.

A few thoughts from this on me:

1. I agree with them 100% on when to file a claim. If we have any minor damage, we always pay for it ourselves. Insurance claims are for major (over $2,000 for us) damage.

2. As such, we've raised our deductibles as high as possible. Doing so saves us a ton of money on our insurance premiums.

3. If you decide to do this as well, be sure to up your emergency fund so you have enough to cover the deductible in case a major accident occurs.

4. Just another expense of having a dog. Sorry, I couldn't help but throw that one in. ;-)

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