Does Homeowners Insurance Go Up After a Claim?

It is possible that your home insurance will increase after you file a claim. The type of claim you make, your claim history, and an assessment of your property all influence whether your premiums rise. If you have made previous liability claims, own a property with a history of claims, or live in an area prone to severe weather, your home insurance rates are more likely to rise following a claim.

How much do home insurance premiums increase after a claim?

The amount by which your premium rises following a claim is determined by the nature of the claim and your claims history. For example, filing a single liability claim, which can be costly, tends to raise your rates much more than filing a single dwelling or contents claim. However, if you file multiple non liability claims in a short period of time, your insurer may impose a significant increase. Rates can also fluctuate depending on the number of claims filed in your area, as large-scale weather events and other regional issues frequently result in increases.

Why do home insurance premiums increase after a claim?

Home insurance premiums rise because insurers believe claimants are more likely to file additional claims in the future. As a result, your home insurance rates are likely to rise following a claim if you:

• Have a history of making liability claims.
• Own a property with a history of multiple claims.
• Make more than one claim over a seven-year time span.
• File claims that suggest your property is in a high-crime area.
• Make claims that show your area is experiencing more severe weather.

Home insurance premiums can increase after liability claims

Filing liability claims is far more likely to result in larger home insurance policy rate increases than filing a single claim on damage covered by your dwelling or contents coverage. Because they frequently involve high costs and litigation, liability claims can have a particularly negative impact on the price of your home insurance premiums. Customers who have made or are likely to make liability claims, such as those with potentially aggressive dog breeds, may have difficulty renewing their policies.

Home insurance premiums can increase after multiple claims

Multiple claims can cause your home insurance premiums to rise indefinitely because insurers believe you are more likely to file additional claims in the future. If you file multiple claims in a short period of time, the cost of your homeowners policy could skyrocket. This includes not only your personal claim history, but also the history of claims made on your property by previous occupants.

Assume you file a claim for water damage caused by leaking pipes or broken windows caused by repeated break-ins. If the insurer discovers that the previous owner of your property filed a series of similar claims within the last three years, it may indicate that the home has a persistent problem.

Using comprehensive loss underwriting exchange (CLUE) reports, insurers can track the last seven years of a home's claim history. Even if you've never filed a claim before, another owner's history of similar claims may result in a significant increase in your home insurance cost.

Home insurance premiums can increase after weather-related claims

If your claims history demonstrates that your property is in an area prone to severe weather, or is likely to be in the future, your homeowners insurance premiums may rise. For example, because states like Florida and Texas experience a lot of severe weather, policyholders in those states face some of the highest home insurance costs in the country. Insurers have also had to raise prices in parts of California and Canada as a result of unusually severe wildfires.

As insurers gather more storm data, it's safe to assume they'll continue to reassess their prices following each storm season.

Although filing a single weather-related claim may not always result in higher premiums, understanding how seasonal weather trends may cause insurance changes in your community can help you be more informed about potential price increases.