To File or Not to File a Claim?

When should I file a claim and when should I not?  It is a common question we get in our agency and every time it is asks we always say, "it depends on each situation".  Let's first tackle this question with how claims can affect your insurance. 

It varies by insurance company but most companies look at a 6 year window for home insurance claims and a 3 to 5 year window for auto insurance claims.   What this means is that if you file a home claim it can have an affect on your premium for up to 6 years and if you file a claim on your auto insurance it can affect your premium for 3 to 5 years.  If you have more than one claim in this window of time it can really have an impact on your premium and may even cause some insurance companies to look at canceling your coverage.  With this in mind, it is best to consult with your insurance agent to see what prior claims you have on your record before deciding whether or not to file a claim.  If you already have a  claim inside one of those windows of time then it may be worth contemplating whether to file a claim or not.

Let me break for one second to mention that liability claims are a must file.  These would be auto accidents that involve a third party bodily injury or a homeowner claim that involves injury to another person.  These need to be handled by the insurance company and their legal firms.  Also, if you have a large claim such as a totaled vehicle or large size house damage, these too are claims you would want to file without hesitation.  The claims that we are talking about that may or may not be worth filing are things such as backing your car into a light post, backing into an unoccupied car or driving off the road and causing damage to the front bumper when you hit a ditch.  On the homeowner side, it would be small claims such as ice dams that cause a $1000 or $2000 worth of damage or a roof claim that the repair is only a $1000 or so.  These are the types of claims it is worth contemplating prior to filing.  When you factor in deductibles and the affect on your premium for a few years, those smaller claims may be best to pay out of pocket.

Mind the GAP

Every time you step off the Tube in London's Underground you hear a women's voice in her perfect British accent reminding you to "Mind the gap". It is a good thing too. At some stops on the Underground there is a pretty big gap waiting for you as you exit and if you got caught in one of those monsters you could be in some trouble. The same is true for the gap that occurs in leases and loans on cars. Normally over time a vehicle's value depreciates faster than the loan or lease can be paid off. This is commonly referred to as being "upside down" on your loan or lease. If during this "upside down" period you total a vehicle in an accident there is going to be a gap between what the insurance company will pay you (actual cash value of the car) and what you still owe on your loan or lease. The good news though is there is insurance that covers this gap and it is appropriately named GAP insurance.

GAP insurance coverage helps pay for the difference between actual cash value of the car and what is owed on the loan or lease. One thing to keep in mind though, GAP insurance from personal auto insurance companies does not cover the cost of warranties or other add on charges that might have been included in the loan or lease.

So for an example, you totaled your vehicle and the insurance company is going to value your car at $5000 but your loan was still $7000. Let’s also say that of the $7000, $500 of it is because of the warranty that you had purchased. Therefore, the insurance company (if GAP insurance was on your policy) would give you $6500 ($7000 due on the loan minus the $500 warranty cost) instead of $5000.

Improved Workplace Awareness Helps Traffic Fatalities Trend Downward

Employers and employees need to address the issues associated with automobile accidents as part of their daily management routine. A heightened awareness of automobile safety in the workplace has resulted in greatly improved fatality results. In 2010, 32,788 people lost their lives in vehicle accidents - down nearly 10,000 in the last decade. Fourteen percent of workplace fatalities result from automobile accidents. That is also down from 22 percent just 10 years ago. While this trend is moving in the right direction, the automobile exposure to a business offers one of the most serious liability exposures that can be faced.


Performance Management consultants recommend compliance with the 4-A’s of driving:

Anticipate what could possibly go wrong and focus on driving to avoid mishaps
Adjust to changing circumstances such as traffic congestion or changing weather
Assume nothing - don’t automatically assume that traffic will stay moving or a car won’t change lanes into your path
Allow no distractions - drivers must avoid anything that takes their focus off of driving

Not only can the strict adherence to an automobile safety program help relieve a business from a serious claim, maintaining drivers with good records reflect positively on the business’ auto insurance premiums.

Performance Management predicts that if employers would institute just two actions, implement standards of practice for driving and educate employees about good driving principles and management’s expectations, accidents would be reduced by more than 50 percent.

Buckle Up Your Best Friend

Dogs are a man’s best friend. So it only makes sense that dogs often travel in vehicles. Sometimes those are trips that are necessary for the dog such as doggy daycare or the vet. However, a lot of the time they are just to keep the driver company as they drive around town or go on a short road trip.

Dogs can be great companions as you drive around in your vehicle but they can also be great distractions. There are times you will see dogs sitting on the laps of the drivers or sitting dead center of the back seat which blocks the driver’s view out of the rear of the car.

In an accident dogs can also be a major hazard. When auto accidents happen they often stop a vehicle cold in its tracks. However, anything not buckled into the vehicle continues to travel at the speed the vehicle was traveling. Often, dogs are not strapped in and therefore become a large moving object in your vehicle. This can cause major damage to your pet as well as possibly to you or anyone else in the vehicle. It is best to have a dog strapped into your car, not only for your dog’s safety but also for your safety and for the safety of those in your vehicle. Visit a pet store near you and pick up an attachment that enables you to comfortably seatbelt in your dog.

Driving Drowsy

A 2008 study, taken from the Annals of Internal Medicine, suggest that some antihistamines may impair driving ability, even more than alcohol. The driver doesn’t even have to feel drowsy.

Forty study participants, when given diphenhydramine and an amount of alcohol to boost their blood alcohol level to .10 (legally impaired in most states), tested worse in a driving simulator when under the influence of antihistamine than under the influence of alcohol. A newer non-sedating antihistamine, Allegra, did not affect driving any more than the placebo given in a blind test screen.

The Asthma and Allergy Foundation of America estimates there are 50 million allergy sufferers in the United States. Allergies account for more than 17 million outpatient physician visits each year. Since the 1940s, antihistamines have been among the most widely prescribed medications. It is estimated that currently there are 30 million patients in the United State taking regular antihistamine medications in this $8 billion drug market.

If you have taken antihistamines, ask your doctor if a non-sedative prescription will work for you.