Filing a claim on your Albany home or auto insurance is the first thing you should normally do in the event of a loss, but what happens when the loss amount is less than your deductible? Should you still file a claim or is it better to take care of your loss out-of-pocket?

How Deductibles Work

Let’s say your insurance deductible is $500 and you suffer about $2,500 in damages to your home or car. That means you’ll have to pay $500 out of your own pocket before your insurance provider covers the remaining amount.

On the other hand, if your losses total $500 or less, your insurance provider won’t cover anything, since there’s nothing over the $500 deductible to cover. In other words, you’ll wind up paying out-of-pocket to cover that loss yourself. Another common scenario is a loss that’s only a couple hundred dollars more than the deductible amount. Paying $500 out-of-pocket just to have your insurer cover part of a $650 claim doesn’t make much sense

Why Shouldn’t You File a Claim?

Depending on your personal situation and the type of loss you’re dealing with, filing a claim may actually cause your rates to increase significantly. In some cases, it may even cause your insurer to drop your coverage. With that in mind, it might not be worth risking either scenario just to recoup a couple hundred dollars over your deductible. If the loss is significantly less than your deductible amount, it’s usually best not to file a claim at all.

But What If Someone Got Hurt?

When a loss involves bodily injury, it’s best to go ahead and file a claim. Otherwise, the injured party could come back and sue you months or even years later. If that happens, your insurer will be under no obligation to defend you in the lawsuit. For more information, contact us to speak to your New York independent agent today.