When to File a Homeowners Insurance Claim

When should you file a homeowners insurance claim?

Just like with car insurance, it’s important to think carefully before filing a homeowners insurance claim. Filing can affect your premium and your long-term costs, so don’t assume your policy covers everything; check your coverage details first. You can learn more in our guide to what homeowners insurance covers.

When you should NOT file a home insurance claim

Be aware of how claims on your record will affect your homeowners insurance premium, and you'll be happier you didn't file an unnecessary claim. Here are the instances in which it would not be wise to call up your insurer.

1: The cost to repair or replace does not exceed your deductible

The same logic in whether or not you should file a car insurance claim also applies to home insurance: if your deductible is less than how much it would cost to repair the damage, it makes more sense to pay for it out-of-pocket instead of facing an increase in your premium. As a general rule, don't sweat the small stuff, and don't involve your insurance company for minor fixes.

2: It's a maintenance issue or normal wear-and-tear

If there's something you could have done to prevent the damage, insurance likely will not cover it. It's the homeowner's responsibility to care for basic upkeep and maintenance, so wear-and-tear in your home will not be compensated for by your insurer even if it ends up completely destroyed after a covered loss. Suppose your roof or fence is already damaged and worn after years of neglect, and it collapses after a heavy snowfall. In that case, the insurance company will deny the claim because it could have been prevented had you kept up with maintaining your property.

3: You've filed a claim within the last three years

Insurance companies get flighty if they look at your claims history and see more than one claim filed within the past couple of years, even if it was never paid out, and it was denied or unresolved. Filing a claim when you already have a few under your belt risks getting your policy non-renewed or voided, and you may even have trouble getting coverage elsewhere.

When you should file a homeowners insurance claim

So, what should homeowners insurance be used for? As a rule of thumb — bigger losses following a peril that damaged your property.

1: The cost to repair or replace exceeds your deductible

Disaster strikes and part of your roof has caved in. The estimate for repair is $5,000 and your deductible is $1,000. It would be prudent — and worth it — to file a homeowners claim with your insurance company to get it fixed. If it's an expensive repair or replacement to fix your home, and it was caused by a covered loss, it makes more sense to get your insurer involved to help pay for it.

2: There's significant damage or a total loss

This is primarily what homeowners insurance is most useful for — when your home suffers a loss so great after an unexpected incident that it becomes uninhabitable. In these cases, you should definitely file a claim to recoup your losses.

How to file a homeowners insurance claim

Policyholders needing to make a homeowners insurance claim may be curious about how the system works. Below you'll find the steps for how to file a standard claim. Keep in mind, however, that your particular situation could make your claims process slightly different.

1: Contact your insurance company

The first step in the claims process is to report the claim to your insurance company — unless your claim is related to a crime such as theft or vandalism, in which case you would first need to contact the police. At this point, your home insurance provider will likely go over whether or not the claim is covered and how long you will have to file the claim. They can also give you guidance on how long it might take to process the claim as well as whether or not the claim will exceed your deductible.

2: Fill out the proper claims forms

After you have made contact with your insurer about the claim, they will send you forms to fill out detailing the damage. Fill out any claims forms that your insurer sends you as thoroughly as you can. Also, make sure to return them promptly to keep the claims process moving.

3: Have an insurance adjuster inspect the damage

In most cases, the next step is to have a claims adjuster evaluate the damage and offer a sum to go toward the cost of repairs. Make sure to be prepared for their arrival by having any receipts or other pertinent information ready. It is likely that they will interview you about the nature of the damage.

4: Make temporary repairs

It's important that you stop further damage from occurring before sufficient repairs can be made. Covering a damaged roof with tarps or boarding up broken windows can prevent the damage from becoming worse, which makes the claim more costly to fix.

5: Make a list of damaged personal property

The more detailed that you can be in your property inventory the better. The value of your items as well as specific model numbers and dates of purchase can help tremendously. When possible, try to include receipts to make things even easier.

8: Keep track of additional living expenses

If you are unable to inhabit the home while repairs are being made, the additional living expenses portion of your home insurance policy covers expenses such as lodging, food and transportation. Keep track of your expenses so that you can be properly reimbursed. 

Common reasons homeowners claims are denied

Any claim you file will be investigated by a trained claims adjuster for authenticity. However, unless you have a company with a bad reputation for claims handling, it generally shouldn't be a surprise (although over 75% of people have experienced an insurance claim denial at some point).^[1] Let's outline the big reasons you can have a denied homeowners claim.

2: If the damage was intentional or avoidable

Insurance will not cover any malicious intent. Any damage you intentionally caused to your home will not be covered. Any time you file a claim, the source of loss will be investigated by trained claims adjusters. Meaning, you should think carefully before you file a claim after intentional damage. Furthermore, if the damage was caused by neglect — i.e., avoidable — don't expect insurance assistance.

3: If the damage was caused by wear-and-tear or maintenance issues

Homeowners insurance is designed to cover sudden and abrupt damage. If you had a slow leak in your basement and mold formed, your insurance will not cover it. The same is true for old roofs, flooring or siding. Any maintenance or wear-and-tear losses are up to the homeowner or a warranty to replace.

4: If your policy was canceled/inactive at the time of claim

This one is pretty straightforward. If your policy canceled on the 1st and you file a claim for damage that occurred on the 10th, your claim will be denied. Even if you reinstate your policy, it's very unlikely your company will honor your claim. Our best advice: always pay your insurance bill! If you're getting a new policy with a different provider, do not leave any days without coverage.

5: If you waited too long

Your statute of limitations to file a claim can vary by your company and by your state. If you wait too long, you could have your claim denied.

6: If the value of damage doesn't exceed your deductible

If you're uncertain of the total cost of damage, get an estimate before you contact your insurance company. Even if you have a zero-dollar payout, this claim can impact your premium.^[2]

How much does homeowners insurance increase after a claim?

Every insurance company calculates this differently; the individual circumstances surrounding your loss, the cost and scale of the damage and who you insure your property with will all contribute to how much extra premium you'll pay after filing a claim. The data below can give you a rough estimate of average rates and increases by claim type, or see more information in our guide to home insurance after a claim.

What causes rate increases?

There are four primary factors that influence rate hikes following a claim.

• Type of claim: Some perils and losses can cause more damage than others.
• Claim payout: The more expensive the claim, the more you can expect your insurer will charge in the future. Your claim payout is correlated to the extent of the damage.
• Location: Home insurance rates vary depending on where you live. If your neighborhood has a history of losses, insurance companies can use this fact as a predictor of any future events that could lead to you filing a claim.
• Claims history: Your personal claims history can be used to assess how much to raise your rate by. Past claims can be used against you to justify a more expensive premium.

Learn more about why homeowners rates increase.

What to consider when filing a homeowners claim

How much your premium goes up after a claim depends on where you live, the type of damage, your claims history, and how much the insurer paid out. Theft, fire, and liability claims usually raise rates the most, often by 20% or more.

Before filing, weigh the payout against the long-term cost. Too many claims can make it harder or more expensive to get coverage later. Knowing when to hold off can help you save money and keep your policy in good standing for when you truly need it.

If you’ve already filed a claim and your rate jumped, it may be time to compare home insurance quotes and explore the best cheap home insurance companies to find a better deal.

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