Ever look at your home insurance policy and wonder if you actually “need” it?
That’s a questions I always ask myself when it’s time to renew my house insurance.
I look at the list of things it covers, and how much coverage in dollars I get, and I ask myself “is this enough coverage?” or “Do I even need coverage for this?”
And then there’s the times when my insurance broker sends me add on protection for things on my home that I don’t currently have protection for.
And then I ask myself again….. is this necessary?
Well, if you find yourself in a similar situation, you’ll know it’s a hard question to answer!
I guess the real question is this: What types of home insurance claims are most prevalent, and how often do they occur?
If you know how likely something is to happen… well, you’ll be more informed to make a good decision!
So today, I want to share with you the 8 most common types of house insurance claims (according to HouseHunt).
1. Wind & Hail Damage (47.2%)
Almost 50% of home insurance claims are a result of wind and hail damage! That’s a whopping number. Now, different parts of the US have different climates and weather characteristics, however, if you live in an area that gets windy or cold, It’s probably a great idea to have strong coverage for wind and hail.
2. Fire, Lighting, and Debris Removal (25.2%)
Not surprisingly, fires and lighting issues causing home damage comes in second place at about 25% of household insurance claims. Fire damage is pretty standard on insurance policies these days, but check what type of coverage you’ve got in this area, and if it’s enough coverage too.
3. Water Damage & Freezing (17.5%)
In 3rd place is water damage! Floods are very common and can wipe out entire neighbourhoods and cities. Though a lot of areas don’t really flood ever – especially really dry climates. However, there are more ways to flood a home than just a lot of rain. Sewage issues and water breaks can happen, and you’ll want to be covered in case that happens.
4. All Other Property Damage (4.7%)
Other types of general property damage is about 5% of overall household claims. These are things like broken windows or doors. These types of damages can be small or very large. Replacing a window yourself may not cost a lot of money, and perhaps you may not even want to go through your insurance company, but other more expensive property damage, say someone did a hit and run on your fence, could cost thousands of dollars to repair.
5. Theft (3%)
I was surprised that theft was so low. At only 3% of all claims, it seems like it should be higher. Theft can occur any time to anyone. Though you usually don’t get 100% of the value of the stolen items (you get a depreciated dollar amount typically), theft can still result in thousands of dollars lost.
6. Bodily Injury & Propert Damage (2.3%)
Injuring happen at home! I always think of seniors slipping in the shower or slipping on the stairs when I think about injuries at home. But it could be falling off your roof or anything else, too. Personally, I’m not sure how important this is, but if you’re someone prone to injuring yourself, make sure you have enough insurance here!
7. Medical Payments & Other (0.2%)
At 7 is medical payments and other related miscellaneous things.
8. Credit Card and Other (0.1%)
And lastly, credit cards come in at one tenths of a percent. Basically nothing.
Summary Of Common Typical Homeowners Insurance Claims
As you can see, the big things you should make sure you have plenty of coverage from are wind and hail, fire, and water damage. These three areas almost 90% of all household insurance claims. That’s a huge number. If you’re ever wondering if you have enough coverage, you should start thinking about these main 3 areas first, and decide if the amount of coverage you have right now is right.
When Should You Claim And NOT Claim On Your Home Insurance?
When something happens to your home, whether its you or your property, and you have coverage, then question you have to ask yourself is if you want to put in a claim for the damages/issue.
It can be a tough question depending on your situation.
For me personally, it comes down to cost. I look at what the damages are, and I ask myself if it’s large enough to warrant a claim.
First of all, claims take time and I don’t want to speak to the insurance claims department if I don’t have to. And they can be… well let’s just say not the nicest people in the world.
Second of all, claims against your home can make your insurance rate go up. And in the end, will making a claim be worth the price of my insurance going up next year, and beyond? Hmmm…
Well, let’s use theft as an example.
If someone broke into my home, damaged my door, and stole a bunch of old DVD’s and my Playstation, I wouldn’t be pleased, but these items are fairly useless to me and don’t have any sentimental or large monetary value. Let’s just say overall, it is a $1500 loss.
Now, let’s say my home deductible is $1,000. A deductible is the amount of money you give up when the insurance company issues you a payment for your claim.
So basically, I would only get $500 from my insurance company. And it’s likely the $500 won’t even be $500, because the amount would be depreciated because the things stolen were “technology” and they lose value over time.
Now, in this situation, would I put in a claim for theft? The answer is a resounding NO. For roughly $500, I’m not going to go through the hassle of putting in a claim. The $500 isn’t worth it, especially considering the claim will likely increase my homeowners insurance rate going forward.
If the amount of loss was in the thousands, say $3000+, It’s very likely I will put in a claim. For me, it comes down to the monetary value of loss.
Below, is a fancy infographic of The most common insurance claims, made by the cool people at HouseHunt. You can totally pin it if you like it!