We hear all the time from prospective clients “I had a claim with zero pay out so it shouldn’t affect me.” or “the insurance company only paid a few hundred dollars.” The truth of the matter is these claims do affect your rate at your current company and could affect you for up to 5 years.
Zero claims and small claims still cost the insurance company to investigate and time to handle, so first off there is a cost even when the payout is zero. After we have cleared up that myth the next thing we need to discuss is why insurance companies care about small claims.
Small claims have a tendency to show patterns, if you ware willing to turn in the small claim today typically you are more likely to turn in one next year as well. Insurance companies have the statistics to back up small claims equal repeat claims.
So, what can we do to prevent these small claims?
First, find out if you need to turn in a claim at all. For instance if you have a hail storm and feel you might have damage call a reputable, local roofer to look at your roof and get their opinion. If you received a scratch in a parking lot on your car, stop by a body shop and see what the cost is to repair it and if it is within a few hundred dollars of your deductible consider paying it yourself.
Remember you can always call your favorite independent insurance agent and get their opinion as well.
In short if you want to keep your future insurance policies as low as possible consider setting a reserve amount aside for small claims because getting an adjuster opinion could cost you additional money for years to come. Use insurance to prevent financial disaster not financial annoyances.