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You can usually cancel a home insurance claim before you receive a payout for it, and most insurers won’t charge you a fee to do so. But your canceled claim will still appear in your home’s claims history, and it could affect your premiums in the future.
Instead of canceling a claim, it’s a better idea to evaluate whether it’s worth filing a home insurance claim at all when damage occurs. Let’s explore how to cancel a home insurance claim, why it might be a good idea to avoid filing an unnecessary claim, and how to compare home insurance quotes if a claim increases your premium.
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How to cancel a home insurance claim
Canceling a homeowners insurance claim doesn’t need to be complicated. Here are the steps to withdraw a claim:
Understand why you want to cancel your claim. Homeowners have many different reasons for canceling a claim. Perhaps you’re worried your insurance company will cancel your policy if you file another claim. Or maybe you’ve decided it would be cheaper and easier to handle the repairs yourself.
Contact your claims representative. You can find your claim representative’s contact information on your insurer’s app. Specifics will vary from company to company, but in most cases, you can go to the insurer’s mobile app, view your claim status, and find your insurance adjuster’s contact information there.
Provide key information. Once you reach your claims representative, tell them your name, homeowners policy number, claim number, and the reasons for canceling your claim.
Follow the claims representative’s instructions for canceling. Some insurers might handle the cancellation process on their end and inform you when they’ve canceled the claim. Or your insurer might ask you to file a cancellation request yourself online or through their mobile app. Most insurers won’t charge you a fee for canceling a claim.
Reasons to cancel a home insurance claim
Speaking to your home insurance agent before filing a claim is always a good idea. Most agents will be happy to discuss the details of your property damage and walk through the specifics of your policy. Together, you can decide if filing a claim is the right idea.
In certain scenarios, filing a claim might be unnecessary or financially misguided. Below are a few reasons to hold off on filing a claim or to cancel it after filing:
The property damage amount is less than your deductible amount. If the cost of repairs is lower than your deductible, you might as well pay for the repairs out of pocket and avoid adding a claim to your insurance history.
You don’t want to affect your premium. Your claims history affects how insurance companies will rate you for future home insurance policies. If the cost of repairs is low, avoiding adding a claim to your history and potentially increasing your premiums might be worth it.
You’ve decided to DIY. The damage might be minimal enough to handle by yourself. Or you might have the knowledge and skill to tackle repair work without spending money on a repair service.
You don’t want to risk a non-renewal. If you file multiple claims, your insurer might decide not to renew your policy and deem your property to be high-risk, which will make it harder to purchase future home insurance policies.
You’re reporting a maintenance issue. Read your policy closely. Many insurance policies won’t cover roof damage, mold, leaks, or pest infestations. Don’t file claims to repair these issues when they aren’t part of your coverage.
You want to preserve your claims-free discount. Many insurance companies offer discounts to homeowners who go several months without filing a claim. Do the math and decide if maintaining your discount outweighs a potential claims payout.
How long it takes to process a home insurance claim
After your home sustains damage, call your home insurance company right away. Describe the situation, ask if you’re covered, and decide if you want to file a claim based on the scope of the damage and the size of your deductible. If you do file a claim, fill out the necessary forms and arrange a time for your claims adjuster to come by.
State laws vary, but in many states, insurance companies must respond to a claim within 30 days. Once the insurer accepts your claim, the time frame for reaching a settlement will vary based on the extent of the damage. Extensive damage after natural disasters can take months to settle. Understaffed insurance companies may take longer to set up an inspection or pay claims.
Home insurance companies have many reasons for denying a claim. If your insurer denies your claim, you may dispute the denial. This process may take a while and lengthen the time it takes to settle your claim and receive your payout.
Keeping a clear inventory of your personal belongings and comprehensively listing all items that were damaged can speed up the claims process. Additionally, if you’re replacing items yourself and receiving a reimbursement from your insurer, replacing items faster and sending receipts promptly to your insurer will expedite the process.
If you decide to cancel a claim, make sure you do so before you receive a payout. Canceling before you receive a payout will mark the claim down as a $0 payout. Insurers may see this canceled claim when they go to rate your future policies.
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How canceling a claim can affect your homeowners insurance
Most insurance companies keep track of the claims you file over the course of your policy term. This loss history is compiled in a Comprehensive Loss Underwriting Exchange (CLUE) report, which insurers use to underwrite your policy and determine your rate. Reports contain up to seven years of claims history. You can visit the Consumer Financial Protection Bureau website to learn how to request your report.
Once you file a claim, it’s on your CLUE report — even if you subsequently cancel that claim. A canceled claim will simply indicate that the insurer paid out $0 on the claim. You may be able to add a notation to your report that explains the situation.
CLUE reports contain all the information associated with your claim, including the type of damage and the resulting payout. Insurers will look at this information when rating your new policy. When it comes time to renew, an extensive loss history may increase your risk score, which can lead to higher premiums on your new policy or even a non-renewal notice.
Home insurance claim cancellation FAQs
If you’re deciding whether or not to cancel a home insurance claim, this additional information may help.
Will canceling a home insurance claim increase your premium?
Canceling a claim will still show up on your CLUE report, which is used to determine premiums. While insurance companies will see that the claim was canceled and the payout was $0, they may still factor this information into your home’s risk score and update premiums accordingly.
Can you cancel your homeowners insurance with an open claim?
Yes, you can cancel your policy even if you have an open claim. Your ongoing claim will be handled by your original insurance company, not your new one.
Can you cancel homeowners insurance after a claim?
Yes, but you should only do so if you have a plan. Having a claim in your history can lead to higher rates in the future. Changing insurance companies after a claim could lead to higher rates on your new homeowners insurance policy. Comparing quotes from multiple insurers can help you find the lowest rate.
What can cause an insurer to non-renew your home insurance policy?
Multiple claims over the course of a policy term may cause your insurer to choose not to renew your home insurance policy. Your insurer may decide that the higher risk of future claims payouts outweighs the income generated from monthly premiums.
A.M. is a Brooklyn-based writer, editor, and content marketing strategist who's worked with major brands in insurance, tech, finance, and healthcare. He also contributes to The Average Joe, a personal finance newsletter that reaches over 250,000 daily readers. Since 2019, he's written for Insurify, breaking down a diverse range of insurance topics into crisp, readable prose.