You may think the reason you pay for homeowner's insuranceis so that you can take advantage of it whenever you need it. But, it's not that simple! According to a CBS Moneywatch article, it's not only the fact that on renewal your homeowner's premiums will likely go up, but instead you could be non-renewed and may have a hard time finding replacement coverage with another carrier. Insurance companies use a database called Comprehensive Loss Underwriting Exchange or CLUE which makes claim information available to most insurance companies.
According to J.D. Howard, an executive director of the Insurance Consumer Advocate Network, “We always counsel people not to make a claim unless the cost of the repair is three times their deductible.” So for example, if you have hail damage to your roof that can be repaired for $1,000, and the deductible on your policy is $500, it’s probably better to pay for the repairs out of pocket. “The insurance company sees too many small claims as a homeowner using his insurance policy to pay for upkeep on his house,” Howard says.
Ultimately, if you need to use your insurance and submit a claim, do it. Also, consider a home deductible that matches the amount you'd be willing to pay out of pocket at the time of a claim because it could save you some money. Why carry a $250 deductible if your not going to make a claim for anything less than $5,000?? You can save some premium up front by adjusting your deductible to a higher amount, and by talking to an independent agent.
