Homeowner Insurance Warning

It happens to everyone at some point: You have to make a claim on your auto or homeowners insurance. In most cases, that first claim should not have an affect on your rates. But one man recently learned the hazard of making more than one claim!

Bad Luck Strikes… Three Times

“We had the ice cube maker and the water line break, and water gushed all over the floor.”

Like most homeowners would, he filed an insurance claim….for the $1,300 repair.

One year later, he had to make a second claim. He says “we went on vacation, and my wife lost her wedding ring.” That claim: $1,000.

Then…who can forget last year’s windstorm in the Cincinnati area. In Jeff’s part of Fairfield the power was out 5 days. So claim number three was for frozen meat Jeff lost when his power went out….for $800.

Renewal Time…Uh Oh!

Due to his string of bad luck, Jeff ended up making three small claims in three years, totaling less than $4,000.

But when Jeff opened his renewal notice from Liberty Mutual Insurance, he found his rate will almost triple next year from $802 to $2,163 dollars!

Jeff said, “I was shocked, surprised, I just couldn’t believe they would raise it that much!”  He was especially shocked because each time he had to pay a deductible, so the payments were even less than his claims.

Liberty Mutual would not discuss particulars of Jeff’s rate hike with me, but promised they would “review his case, and get back to him.”

Remember this little story if you need to file a small claim on your homeowner’s insurance. Sometimes it’s better to take the small loss than to pay the trumped up premiums for it later.