Does Home Insurance Premium Increase after Claim | Expert Guide

Does home insurance premium increase after claim? Making a home insurance claim can sometimes lead to a premium increase, but not always. Depending on the insurance company and the state you live in, your premium may go up or down after making a claim. It is important to shop around for an insurance company that best suits your needs.

Some companies are more forgiving after a claim has been made, while others are not. Be sure to ask questions and understand the company’s policies before signing up for home insurance coverage.

Does Home Insurance Premium Increase after Claim?

Does Home Insurance Premium Increase after Claim

Homeowners’ insurance rates frequently increase after a claim because your insurer believes you are more likely to file another claim in the future. This is especially true for claims involving water damage, dog bites, and theft.

Yes, your home insurance premiums may rise when you submit a claim, but this is dependent on the type of claim, the amount of the claim, and how frequently you’ve filed claims in the past.

Filing a homeowners’ insurance claim can raise your premiums by as much as 7% to 10% – just from one claim.

Your home coverage premiums may increase if you file a claim.

Let’s look at this further:

How much do home coverage premiums step up after a claim?

The type of the claim and your claims history affect the amount by which your premiums increase after a claim. It depends entirely on the kind of homeowner’s insurance payout you file.

If your yearly premium is $1,000, your first claim might result in a $100 increase. It will, however, depend on the kind of claim and the amount involved.

A single pricey liability claim, for example, tends to boost your premiums far above a single living or property ownership claim. Your insurer may levy substantial compensation if you make several no-liability claims in a short time.

Rates can also differ based on the amount of claims made in your area since maximum weather disasters and other area problems might increase rates.

Why Do Premiums for Home Insurance Go Up After a Claim?

Why Do Premiums for Home Insurance Go Up After a Claim

Home insurance premiums are rising because insurers predict claimants will file more claims in the coming days. Also, if you:

  • Have a history of filing liability claims, your home coverage premiums are likely to rise after a claim.
  • Have an asset with a past of many claims.
  • File several claims in seven years.
  • File claims stating that your home is located in a crime-prone area.
  • Make assertions proving that the weather in your area is becoming increasingly severe.

Why do insurance prices rise once a claim is filed?

Following a claim, householders’ insurance premiums typically increase because your insurer feels you are more likely to submit another assertion in the future.

This is particularly true in water damage, dog attacks, and theft cases. Your property insurance premium is raised in advance to compensate for the possibility of another claim payment.

As previously stated, whether or not your coverage rate increases due to a claim depends on the circumstances. Certain types of claims have a more significant influence on insurance premiums than others. Following a claim, you can anticipate your premium to rise if you fall into any of the following categories:

  • You live in an area where severe weather is typical;
  • Your home is in a high-crime neighborhood;
  • You have previously filed liability claims.
  • You’ve had a home with a record of claims for many years and have filed several claims.

Your insurance rate is more likely to increase if you file a liability claim than a property destruction claim. If you make a responsibility claim, you risk being sued. Legal fees and settlements may be unreasonably costly, placing you and your insurer in jeopardy.

Which claims are more prone to a rate increase?

Which claims are more likely to result in a rate increase

From your insurance carrier’s viewpoint, not all claims are equal – certain forms of damage or loss are more likely to occur again than others.

In general, insurance firms look to raise rates or target policies for cancellation or non-renewal following non-weather-related claims, such as:

  • Water harm
  • Mold
  • Theft
  • Fire
  • Dog bites — or other types of liability claims

A claim for any of these perils may result in a rate rise. If this is your second or third claim in five years, you may face non-renewal.

If you file a claim for any of the hazards mentioned above, you should pay close attention to your policy deductible. You must pay out of pocket this amount before insurance coverage kicks in.

Filing a claim that isn’t even double your deductible amount may not be worth it.

Home coverage premiums can increase after liability claims.

Submitting a specific claim on damages insured by your home or possessions policies is far less likely to result in a rate increase than offering a single liability complaint.

Liability lawsuits may significantly influence the price of your homeowner’s insurance premium since they typically entail significant expenditures and litigation.

Customers who have already made or are likely to cause damage claims, such as those who own potentially violent dog breeds, may have difficulties extending their policies.

Is it ever permissible to raise its prices following a claim?

Property insurance carriers may raise your premium following a claim in some instances. However, there are specific situations in which an insurer cannot increase your price. Consumer protection laws vary depending on where you reside since insurers are regulated at the state level.

The following are some of the factors that restrict insurance firms from boosting premiums:

  • When a homeowner asks about submitting a claim but does not follow through.
  • When a homeowner presents a claim, it is refused (denied claim).
  • Also, when a homeowner files a single claim.

When a homeowner files a claim for weather-related or natural-disaster-related damage.

As a homeowner, it would be beneficial if you were familiar with your state’s legal provisions. Contact your state’s insurance agency to learn more about the restrictions in your region. Check with your insurance carrier to discover if certain circumstances are excluded from premium adjustments.

Multiple claims might result in a rise in home insurance costs.

Multiple claims might increase your home insurance price to rise further since insurers believe you are more likely to file additional shares in the future.

If you file many claims in a short time, the cost of your homeowners’ coverage may skyrocket. This includes not only your personal claim history but also the history of claims made on your property by prior occupants.

Frequently Asked Questions

How long do homeowners coverage claims remain on your record?

Depending on the insurance company, homeowners’ insurance claims might stay on your record for up to seven years. However, certain businesses, such as Swift, stop taking into account earlier insurance claims after three years.

Most businesses can gain access to your claims history through national databases that track claims for a set number of years.

Are there times when insurers cannot raise your rates after a claim?

Because insurance firms are regulated at the state level, the cost varies based on where you live.

Some states prohibit rate hikes or non-renewal after the following dates:

  • Inquiries about basic claims
  • Claims with a zero-dollar value – claims that did not result in a reimbursement
  • Solitary claims
  • Claims relating to weather or natural disasters
  • Contact your state’s Department of Insurance for a complete list of homeowner insurance customer safeguards.

Is it necessary to get homeowners insurance?

Any state does not need homeowners’ insurance. On the other hand, every homeowner should think about purchasing coverage for financial reasons. If you don’t have any personal property, you are financially liable for repairs or replacements.

If a fire or a natural catastrophe affects your house, you must cover the whole cost of rebuilding. Furthermore, most lenders will need you to get property insurance if you have a mortgage.

Can insurance companies raise your rates after a claim?

In general, if you claim your insurance policy that exceeds a particular amount due to an incident that is mostly your fault; your premium will be raised by a certain percentage.

Does a comprehensive claim raise rates?

In most cases, a comprehensive claim will raise your auto insurance premiums. However, you can save money by becoming a safer driver or selecting an insurance carrier that does not raise premiums for drivers who have previously filed extensive claims.

Are there times when insurers cannot raise your rates after a claim?

Because insurance firms have regulations at the state level, the cost varies depending on where you live.

Some states prohibit rate hikes or non-renewal after the following dates:

Inquiries about essential claims for zero dollars that did not result in a reimbursement solitary claims relating to weather or natural disasters Contact your state’s Department of Insurance for a complete list of homeowner insurance customer safeguards.

Bottom line

Suppose your loss was caused by an act of God, such as roof damage from a hurricane. If, for example, a tornado causes a tree to fall on your house, insurance companies will generally treat this as a non-score able claim. This means that you will not have penalizations with a premium rise for other claims because you could do nothing to prevent the harm.

For example, some types of fires, liability claims, medical claims, and water loss claims. Even pipe breakage and wind-driven water incursion are taken into account.

A homes insurance policy provides peace of mind. Your insurance provider guarantees to reimburse you for the cost of repairs if your residence suffers harm. However, you may be wondering if your home’s insurance premiums would rise as a result of a claim. 

These are frequently referred to as qualifying losses

It usually means that insurance companies charge a higher premium or abolish the claim discount. When you file this type of claim, the increase is generally between 10% and 20%. Insurance companies will not drop you unless you have a history of filing multiple claims in a short time.

If you make a claim, the insurance company will want to see evidence proving that you did the repairs within an acceptable time frame. Most importantly, if you file a single claim, you are not locked into your present provider and will usually have little trouble getting insurance, unless, of course, your claim is a liability claim.

Even if you’ve had a previous liability claim, most insurance companies will only look back three years. Check your claim history to see insurance rates in your area. Hope you got your answer on does home insurance premium increase after claim.


Adam Grabois is an expert in all aspects of Insurance and Property with 20 years of experience. He is a licensed broker of all lines including property, casualty, life, and health. As a licensed adjuster, he is well-versed in all aspects of insurance, and he owns All Needs Insurance agency in Florida.

He attended Tufts University where he earned his undergraduate degree, followed by a Master's degree from Columbia University.

Adam shares his breadth of experience by helping many businesses and individuals manage risk and protect themselves financially. He now shares this with the audience of the "Pro Insurance Info" website.

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