A man writes in a notebook while talking on his cellphone, as he wonders whether to make a home insurance claim

When the unexpected happens, many people debate whether or not they should make a home insurance claimopens a pop-up with definition of claim. Maybe they’re worried about losing their claims-free discount, risking a denied claim, or waiting too long for their insurance company’s contractor to complete repairs. But remember, the whole point of home insurance is to protect you when you need it most — the last thing you should be worried about is whether or not you should make a claim. So, if you ever find yourself debating “to claim or not to claim,” ask yourself these three questions.

Was the damage caused by an event that’s covered by my policy?

This is probably the most important question to start with — because if you answer “no” to this one, you won’t need to worry about the rest. Every home insurance policy should clearly outline which types of perils are covered and which are excluded. If your property was damaged by a perilopens a pop-up with definition of peril that isn’t included in your policy, the damage won’t be covered by your insureropens a pop-up with definition of insurer, so you won’t be able to make a claim.

Here’s an example:

If your home insurance policy doesn’t cover damage caused by racoons and other animals, you won’t be able to claim the damage done to your roof when a racoon makes himself at home in your attic. In this case, you shouldn’t make a claim.

Is the damaged item covered by my policy?

This one is pretty straightforward, too. If the item that was damaged isn’t covered by your policy, you’ll have to repair or replace it yourself, so you won’t be able to make a claim. While most of your personal belongings are probably covered, some valuables, breakables, and other specialty items may not be — be sure to review your policy’s special limits and exclusions if you’re not sure.

Here’s an example:

If your home insurance policy excludes damage to chinaware due to accidental breakage, you won’t have any luck making a claim when your nephew knocks over a stack of your favourite designer dinner plates. In this case, you shouldn’t make a claim.

Is the damage worth more than my deductible?

The deductible listed in your insurance policy is the amount of money that you’ll have to pay out of your own pocket before your insurer will pay the remaining balance of a claim (up to the limit in your policy, of course). So, if the damage done will cost less to fix than the amount of your deductible, you won’t receive a payout if you make a claim. In this case, it probably doesn’t make sense for you to make a claim at all, but you can contact your licensed broker if you need help deciding what to do.  

Here’s an example:

If your deductible is $1,000 and you’re thinking about making a claim for damage to your $800 patio set, you should know that you won’t receive a payout for your claim because replacing the patio set would cost less than the amount of your deductible. In this case, there’s no reason to make a claim.

If the damage will cost less to fix than the amount of your insurance deductible, you won’t receive a payout if you make a claim.

On the flip side, if the damage done is likely to be worth significantly more than your deductible (and if you answered “yes” to the first two questions in this article), you should contact your broker or your insurance company and start a claim as soon as possible.

Here’s an example:

If you have a kitchen fire and your kitchen needs to be restored by a professional, it’s likely that the repairs will cost significantly more than your $1,000 deductible — and you’ll probably need support with additional living expenses, too. Situations like these are exactly why you have home insurance, and it would be worthwhile for you to make a claim. 

Note: Certain coverages in your policy may not require you to pay a deductible (like lock replacement coverage, for example). If you’re wondering whether or not your deductible will apply in any given situation, you can read through your policy or contact your broker.

When not to make a home insurance claim

Here’s a quick recap of three reasons not to make a home insurance claim:

  1. If the damage was caused by a peril that isn’t covered by your policy
  2. If the item that was damaged is excluded from your coverage
  3. If the damage is worth less than your deductible

The whole point of home insurance is to protect you when you need it most — the last thing you should be worried about is whether or not you should make a claim.

If you’re debating whether or not you should make a claim, your licensed home insurance broker can help you determine whether or not the damage is likely to be covered by your policy, as well as provide you with any other guidance you need. The good news is, if you start a claim and then decide you’d rather take care of the damage yourself (to keep your claims-free discount, for example), you can generally cancel the claim without it affecting your premium or your claims-free status. Every insurance company and policy is unique, so review your policy documents carefully and contact your broker if you have any questions along the way.

Wondering how making a home insurance claim might affect your premium? Here’s the inside scoop on how and why the cost of your insurance could change after you make a claim.

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