Your home insurance policy provides financial protection after covered events like fires, theft, or windstorms. After a loss, a home insurance claim is the first official step toward requesting reimbursement for covered damages.
Knowing when and how to file a home insurance claim can help you expedite the process and rebound after your home is damaged.
How does a home insurance claim work?
The exact details of how an insurance claim works can depend on your insurer, policy, and type of claim, but the process generally looks like this:
Assess and document damage. As soon as it’s safe to do so, assess the damage and record it by taking photos or videos of the destroyed or damaged property. Take note of the date, time, and any other pertinent information, such as the name and contact information of any first responders, if applicable.
Contact your insurer to file a claim. The best way to start a claim and initiate the first notice of loss is by contacting your insurer over the phone or using their online portal or mobile app. However, some insurers allow policyholders to file claims by mail or by visiting the insurer’s physical location if one exists.
When you file your claim, you’ll likely need to provide your policy number and information about the incident, including the type of loss and the date and time it occurred.
Make emergency repairs. After a claim, it’s essential to prioritize the safety and security of your home and its residents. If possible, take immediate steps to prevent further damage, such as removing a fallen tree, covering exposed portions of a roof or wall with a tarp, reinforcing a broken window, or turning off any water source causing damage.
Always keep receipts for any incident-related repairs, temporary or otherwise, that you make.
Speak with your claims representative and/or insurance adjuster. The insurance company will appoint an adjuster or claims representative to manage your claim, assess the damage, ensure that a covered event caused the loss, and estimate the cost of that loss.
The adjuster or representative is often your primary contact through the claims process. Depending on the nature of your claim, the adjuster or representative may schedule a time to visit your property or speak with you over the phone.
Get estimates from contractors. You don’t always have to use the contractor your insurance company recommends, though there may be benefits if you do. For instance, contractors that partner with your insurer likely have a history of reliable workmanship. Depending on your insurer and policy, you may even see a cost benefit if you work with a preferred partner.
Even if you don’t work with a preferred partner, always make sure the contractor you choose is insured and licensed to perform the required work. It’s also helpful to check reviews available online or directly from friends, family, and community members.
Receive your settlement check and pay for repairs. Once your claim is approved and you agree to the settlement offer, the insurer will process and pay the claim.
Payment methods vary by insurer, state, and claim type. Generally, insurers issue payment by direct deposit or electronic check, though you may receive a physical check. However, if you have a mortgage on your home, your claim payment may be issued to you and the mortgage company.
Learn more: How are home insurance claims paid?
Keep in mind that the claim process can vary by the state you’re in and the type of claim you file. Your insurer can provide specific details about what to expect after you file a claim. If you have any questions, always contact your insurer directly, starting with your assigned adjuster or claims representative.
When should you file a home insurance claim?
Generally, you should consider filing a home insurance claim under these circumstances:
Your policy covers the loss
If the loss is significant, and you believe an event covered by your policy caused it, you likely have good reason to submit a claim. However, home insurance does not cover everything.
If you're unsure if damages are covered, review your policy documents or contact your insurer to discuss coverage details.
The cost of repairs exceeds the deductible
It may make sense to file a claim if the cost of repairs exceeds your deductible, or the amount your insurer will subtract from most claim payouts.
For instance, if you have a $1,500 deductible and the estimated cost of damages is $5,000, your insurer will issue you a check for $3,500. You’ll need to pay the $1,500 worth of repair costs out of pocket.
If the cost of repairs is less than, equal to, or relatively close to your deductible, it often doesn’t make sense to file a claim.
Someone gets injured on your property
If someone gets injured on your property, your home insurance policy can help cover their medical expenses in one of two ways:
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Personal liability insurance. This part of a standard home insurance policy will cover the injured party's medical bills and any incident-related loss of wages if you or a family member is at fault for their injuries. Liability coverage can also cover your legal expenses and any settlements or judgments if the injured party sues you.
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Medical payments. This part of your policy can cover minor medical expenses, often $5,000 or less, if someone is injured on your property, regardless of who is at fault.
You (or a family member) damages someone’s property
If you or a family member accidentally damages someone’s property, and the cost to replace it is significant, you may be able to file a personal liability claim. However, always weigh the pros and cons before moving forward.
If repair or replacement costs are relatively minor, consider paying out of pocket to reduce the risk of a corresponding premium increase when your policy renews.
How is an insurance claim paid?
Once your insurance company approves your claim, it will typically pay you via check or direct deposit. How long this takes depends on your insurer’s claims process and the state where you live, as state laws dictate how fast an insurer must pay you once a claim is approved.
If the covered event results in numerous types of damage, such as damage to your home’s structure and your personal property, you’ll likely receive a separate payout for each type of claim submitted.
Further, in some cases, you may receive a partial claim payment to help you begin repairs, with the full payment coming as the claim and repairs progress. These partial advanced payments are beneficial in preventing or reducing out-of-pocket expenses.
Depending on the situation, an insurer can issue home insurance claim payouts to the following parties:
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The property owner. The insurer pays the property owner directly, and the owner can use the funds to make home repairs or replace damaged property.
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The contractor. The insurer may send payment directly to the contractor performing the required repairs. In this case, the contractor may require you to sign a “direction to pay” form authorizing the insurance company to pay them directly.
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The mortgage lender. If you have a mortgage, the payment may be issued to you and the mortgage lender. The claim payout can be deposited into your escrow account and released by the lender at key intervals.
How can you use home insurance claim money?
When you receive your home insurance claim payout, you should use it for its intended purpose: To repair, replace, or rebuild your property.
If you receive the funds directly, complete the repairs, and have money left over, you can usually use it as you see fit. However, it’s essential to refer to your policy or speak with your insurer about any stipulations about excess payouts.
However, as specified above, your insurer may not pay you directly.
If your claim payout is sent to your mortgage lender and placed in your escrow, your lender will release payments to you or the contractor performing the repairs as work progresses. If there is excess after repairs are complete, your lender may issue you a refund or put the excess toward your mortgage balance. The exact outcome depends on your insurance policy and mortgage agreement.
Does your home insurance premium go up after a claim?
Your insurer may increase your home insurance premium after a claim, but this depends on several factors, including your insurer, policy, claims history, and the nature of the claim.
Some states prohibit insurers from increasing policyholder rates due to catastrophe claims. In other instances, an insurance claim may not directly raise your premiums, but losing an associated incentive, such as a claims-free discount, could result in a higher premium.
If your claim results in a higher premium, you will generally not see the increase until your policy renews.
How many home insurance claims can you make?
While there’s no maximum number of home insurance claims you can make, frequent claims can make you a high-risk policyholder and lead to negative effects, such as increased premiums or policy non-renewal. A high number of claims on your record can also make shopping for a new policy more difficult.
Claims can stay on your record for up to seven years, but insurers generally look back between 3 and 5 years. Further, “frequency” may mean as few as three or more claims within that timeframe, depending on your insurer.
Though you can’t prevent all claims, you can reduce the risk of unnecessary ones by performing regular home maintenance, installing security and safety systems, and hardening your home against certain perils, such as windstorms or hurricanes.
Further, consider paying for minor repairs out of pocket, especially if the cost is relatively equal to or only slightly higher than your policy deductible.