I’m a new homeowner (bought in 2022) and I didn’t know that insurance claims affect you. When I moved in, I had a small leak and the plumber suggested using my insurance. I filed a water claim and they paid out about $3,000. Fast forward to late 2024, I had a bigger leak (my fault) and filed another claim, not realizing that this could be tracked. I started seeing posts about people getting dropped for having too many water claims, so I closed the claim. The claim will still be on my record, but will closing it help at all? I know my rates will go up, but will USAA drop me altogether?
You’re only supposed to use insurance for claims you can’t afford to fix on your own. If you do make a claim, make sure it’s a big one.
Marston said:
You’re only supposed to use insurance for claims you can’t afford to fix on your own. If you do make a claim, make sure it’s a big one.
Exactly this point.
Marston said:
You’re only supposed to use insurance for claims you can’t afford to fix on your own. If you do make a claim, make sure it’s a big one.
Lesson learned… they really need to teach this stuff somewhere because it’s not obvious at all.
@Davi
In general, that’s how all property and casualty insurance works. Whether it’s car, home, or rental insurance. The only exception is health insurance, which used to work similarly but doesn’t anymore.
@Dru
Capitalist school system working as intended.
Jem said:
@Dru
Capitalist school system working as intended.
It’s not the school system that leads to CEOs making questionable decisions. They do that for profit. Greed becomes the focus, and it takes a lot of willpower to care about society in a system like this.
@Davi
Username does not check out.
I had a leak last year and made a claim. Total damage was around $33,000. Just got my renewal, and my rate went up by 40%. Could be from the claim, could just be because rates are going up. Probably a mix of both.
@Dar
What happened?
Marin said:
@Dar
What happened?
A drain under the kitchen sink backed up and flooded the floor. We mopped it up and thought it was fine, but about six weeks later, I noticed mold and rot behind the cabinets. The cabinets had to be replaced, and the flooring was also ruined. The flooring couldn’t be matched, so I had to replace 1400 sq ft of it. The countertops also had to be replaced because they couldn’t be removed without breaking.
@Dar
I’m dealing with something similar right now. The dishwasher drain hose failed and leaked water behind the dishwasher. I found a huge puddle of water in the crawl space. The kitchen floor and part of my hardwood are ruined, and I can’t find the same flooring. Looks like I’ll need to replace the subfloor and remove the cabinets. I’m dreading what the costs will be.
There’s no point in dropping the claim now. It’s already reported and on your claim history. We can’t say if you’ll be dropped or just get higher rates. You might be fine, but it’s a good idea to avoid making claims unless absolutely necessary.
@Quinn
Fair point. Lesson definitely learned.
@Quinn
That’s not the best advice. If you can afford to pay out of pocket, a claim with a $0 payout won’t hurt your rates as much. Get a water leak detection system so you can prove you’re trying to prevent water damage. A small claim might not be considered a major loss and may not raise your rates.
@Jamie
As an employee, I can tell you that’s not accurate. A claim is a claim. Whether there’s a payout or not, it’s still on your record.
Koa said:
@Jamie
As an employee, I can tell you that’s not accurate. A claim is a claim. Whether there’s a payout or not, it’s still on your record.
Read the property chargeable loss rules for KC, then come back to me. A claim with a $0 payout doesn’t count the same as a big payout. Mitigation steps can help lower the impact.
Koa said:
@Jamie
As an employee, I can tell you that’s not accurate. A claim is a claim. Whether there’s a payout or not, it’s still on your record.
A claim with no payout won’t hurt as much as a large one. If your claim history is clean, insurers would rather stay with you than a riskier option. Mitigation is good advice, and a $0 payout claim can help. But yeah, the claim’s already open, and you’re right, it does affect your record.
Why don’t schools teach us about insurance? Instead, they focus on things like the cosine of a tangent.
It’s a very common misunderstanding. A lot of people think insurance is just a prepaid maintenance plan.