Would you file a claim?
Scenario: In 2024, a condo owner successfully contested the non-renewal of their insurance policy, which had been issued a few months after they submitted a $13,000 claim for storm damage incurred in late 2023. Now, the owner is dealing with limited water damage to their walls and hardwood floors due to fire suppression after flames from a nearby building spread to their unit. Additionally, they are unable to stay in their apartment for an estimated 2-3 months because of damage to the common areas, but their condo association policy does not cover alternative living expenses. The owner is anxious that if they file another claim with their insurer, it could lead to permanent non-renewal. What would you recommend?
In this situation, it’s essential to weigh the potential risks and benefits of filing a claim. Here are a few points to consider:
Assess the Damage: First, make a thorough assessment of the damage. Can you estimate the cost of repairs and the potential expenses for alternate living arrangements? If the costs are significant, filing a claim might be necessary to recover those expenses.
Review Your Policy: Before deciding, carefully review your insurance policy. Understand what is covered, specifically regarding alternate living expenses and any impacts on renewal. Some policies may have provisions that provide protection against non-renewal after a claim, so it’s essential to be clear on your coverage.
Consider Future Implications: While it’s understandable to worry about non-renewal, consider whether dealing with the current damage without filing a claim is realistic. If the damages are substantial, you might end up facing higher out-of-pocket expenses than if you filed a claim.
Consult with an Insurance Agent: Speaking with your insurance agent can provide clarity. They can give insights based on your insurer’s claim history and how they typically handle multiple claims close together.
Explore Alternative Solutions: If you’re concerned about filing a claim, see if there are other possible financial solutions to manage the situation—such as temporary housing options or local housing assistance programs.
Document Everything: If you do decide to file a claim, ensure that you thoroughly document all damages and expenses incurred. This documentation can be crucial in supporting your case.
Ultimately, if the damage is significant and the costs are going to put a strain on your finances, it may be worth filing the claim despite the potential risk of non-renewal. Your long-term peace of mind and financial security should guide your decision.