Top and Bottom 5 Most Costly States to Make an Insurance Claim

October 10, 2013

BY 

A recent study by InsuranceQuotes.com found that filing a home insurance claim can result in a hefty rate increase in certain states but not others.

The study used a hypothetical two-story, single family home covered for $144,000 with a $500 deductible, and revealed how much annual premiums can go up for claims such as fire, hail, liability, medical, theft, vandalism, water (non-weather related), weather, and wind.

According to the study, premiums in 31 states and the District of Columbia increased by an average of 10 percent or more after filing a single claim. In other states, premiums increased very little, if at all.

For example, homeowners who file a single claim in Iowa can expect their annual premium to increase, on average, by 16 percent. Conversely, filing a single claim in Texas won’t result in any premium increase.

The reasons behind why there is such a disparity from state to state are varied and nuanced, says Chris Hackett, director of personal lines policy at the Property Casualty Insurers Association of America. “You have to keep in mind that insurance is regulated on a state-by-state basis, and different states are faced with different types of risks and claims, which will also affect premium costs.”

A recent study byInsuranceQuotes.com found that filing a home insurance claim can result in a hefty rate increase in certain states but not others.

The study used a hypothetical two-story, single family home covered for $144,000 with a $500 deductible, and revealed how much annual premiums can go up for claims such as fire, hail, liability, medical, theft, vandalism, water (non-weather related), weather, and wind.

According to the study, premiums in 31 states and the District of Columbia increased by an average of 10 percent or more after filing a single claim. In other states, premiums increased very little, if at all.

For example, homeowners who file a single claim in Iowa can expect their annual premium to increase, on average, by 16 percent. Conversely, filing a single claim in Texas won’t result in any premium increase.

The reasons behind why there is such a disparity from state to state are varied and nuanced, says Chris Hackett, director of personal lines policy at the Property Casualty Insurers Association of America. “You have to keep in mind that insurance is regulated on a state-by-state basis, and different states are faced with different types of risks and claims, which will also affect premium costs.”

Top 5 States for Average Premium Increase as a Result of Filing One Claim:

5. Oregon 17% increase

4. California 18%

3. Maryland 19%

2. Connecticut 21%

1. Minnesota 21%

 

Bottom 5 States for Average Premium Increase as a Result of Filing One Claim:

5. Massachusetts 2% increase

4. Vermont 2%

3. Florida 2%

2. New York 1%

1. Texas 0%