Homeowners insurance protects your home and personal belongings from covered damages or losses. In the event your house is damaged or burglarized, you can file a home insurance claim with your insurance company to be reimbursed for the loss.
While filing claims are how you make use of your homeowners insurance, there's a caveat involved: claims often stay on your record anywhere between five and seven years. If an insurance company notices you have multiple claims on your record, they may charge you higher rates or deny you coverage altogether.
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How long does a home insurance claim stay on your record?
Home insurance claims will stay on your record anywhere from five and seven years but the exact time frame depends on the insurance company pulling your claims history. The amount of time can also depend on the type of damage that was reported. Claims that were filed by the previous owners of your home may also show up on your claims history.
When you apply for home insurance, most companies will access your claims history from the last five years through a database like the Comprehensive Loss Underwriting Exchange, or CLUE. Based on the information they find in your CLUE report, an insurance company may set your rates higher or deny you coverage altogether.
Your CLUE report may also include claims from past owners if they lived in the home within the past five years. Depending on the nature of those previous claims, an insurer may consider your home or area at a higher risk for certain types of losses and you could be charged a higher premium as a result. If you have an extensive claims history, insurers may also quote you higher premiums since it’s likely that you’ll continue to file more claims.
How do claims affect your homeowners insurance?
Filing claims can impacts your homeowners insurance in two noteworthy ways: they can cause your rates to go up and they can make it more difficult for you to buy homeowners insurance down the road.
When you get home insurance quotes, your rates will be determined, in part, by your claims history and your likelihood to file a claim. You may be denied coverage altogether if companies that are more risk-averse see you’ve filed multiple claims.
Along with frequency of claims, companies will also look at the type of losses your home has suffered. Claims related water damage, theft, and dog-bite liability tend to have a bigger impact on your rates than weather-related losses.
In most cases, you'll find out about claim-related rate increases at your annual policy renewal. If you noticed your rates went up since your last policy term, make sure to ask your insurance provider for the reason.
Average cost of home insurance after you file a claim
Here's a look at how much annual home insurance rates vary for a few popular insurance companies based on the number of claims filed over a five-year period:
Company | No claims | 1 claim | 3 claims | 5 claims |
|---|---|---|---|---|
AAA | $1,930 | $2,147 | $4,798 | $10,962 |
$1,266 | $1,452 | $1,959 | $2,188 | |
$1,717 | $1,930 | $2,904 | $4,446 | |
American Family | $1,799 | $1,984 | $2,899 | $6,677 |
$1,884 | $2,040 | $2,665 | $3,005 | |
$1,465 | $1,534 | $2,440 | $3,919 | |
$1,969 | $2,157 | $3,852 | $9,698 | |
$1,915 | $2,250 | $3,878 | $6,598 | |
$1,181 | $1,551 | $2,542 | $4,886 | |
$1,547 | $1,634 | $2,174 | $2,842 |
Methodology: Average annual rates are based on our analysis of home insurance premiums provided by Quadrant Information Services in March 2022 for ZIP codes in all 50 states plus Washington, D.C. for policyholders with different claims histories.
How to keep your home insurance rates from going up after filing a claim
Before filing a homeowners insurance claim, ask yourself whether it's something you'd be able to pay for on your own with a few month's savings. In general, if the damage or loss is close to your deductible amount, it's likely not worth filing a claim.
For example, say your home insurance deductible is $1,000. If your septic tank is damaged and the estimated cost to repair it is $1,100, you'd only receive a check for $100 after payment of your deductible. In this instance, $100 in savings is not worth the potential rate increase at your next policy renewal.
But home insurance is there for a reason, and filing a claim is often unavoidable. If your rates go up after a claim, or you find out at renewal that your rates are increasing, it’s probably a good time to re-shop your home insurance coverage. You may find that you’re able to get the identical coverage for a much lower rate, even with a claim on your record.
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