4 ways a claim can affect your home and auto insurance
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So, you forgot to turn off the tap while filling the bathtub, resulting in major water damage to your basement. Or you got rear-ended while driving your car and your bumper needs to be replaced. Thankfully, you have home and auto insurance for worst case scenarios.

But you might be wondering, what happens to your policy when you file a claim. Will your premium go up? How many claims can you file? Is it worth it? Here are some things to consider regarding insurance claims and how it could affect your premium.

Heads up! You should always tell your insurer about any incident or accident happens at home or on the road. They will advise you on the best path forward to make your experience as simple and stress-free as possible. If you’re a Sonnet customer, our claims professionals are just a phone call away and available 24/7.

Sometimes it makes more sense to pay for the repairs yourself. But you still must notify your insurer because they’ll need to be aware that the risk (your home or car that they’re insuring) was damaged. Learn more about what happens after you file a home insurance claim. Or maybe you're wondering why your claim was denied? It could be because the loss doesn’t fall within the terms of your insurance policy.

How does my claim history affect my home insurance?

Well, it depends. Home insurance companies have different rules regarding how your claim history could affect your home insurance. The biggest impact filing a claim can have is on your premium. The amount your premium could increase Here are two ways a claim could affect your home coverage:

1. Your home insurance rate could increase at renewal time. If you’ve had a claim in the past or if you don’t have first-claim forgiveness, you could see an increase in your premium when your home insurance is renewed.

2. You could lose your claims-free savings. If you had no claims when you initially purchased your property insurance and received a no-claims discount, you could lose it at renewal. But the good news is your discount could be reapplied in the future if you stay claims-free for a set amount of time according to your insurer.

How does my claim history affect my auto insurance?

There are a number of factors that could affect how much your auto insurance rate could change after a claim. For example, were you at fault? Do you have a clean driving record? Have you had any previous claims? Does your insurer offer accident forgiveness? Here are two ways a claim could affect your auto coverage:

1. Increased auto insurance rate at renewal time. The good news is, if you’re deemed not-at-fault, your rate isn’t likely to increase

2. Insurers could deny or reduce your coverage. An insurers might charge you a lot more than if you didn’t have any claims history. Insurers can even deny or reduce coverage to an entire household if you have a high-risk driver living under the same roof. Even if they’re insured elsewhere, they still could have access to your car. Therefore, having multiple claims could also impact your household, not just you.

Did you know? Remember, when you lend out your vehicle, you’re also lending out your insurance. If someone else is driving your car, gets into an accident and you have to file a claim, it could affect your record and your rate – even if you had nothing to do with the incident.

When you’re legally required to submit an auto claim

In general, you’re required to report all car accidents to your insurance provider immediately. Here are some guidelines of when you’re legally required to report an accident to the police if you live in Ontario:

  • Someone gets injured because of the car accident
  • The total damage is over $2000 to your vehicle or someone else’s
  • You suspect criminal activity from the person you got into the accident with

Did you know? These types of claims will generally fall under one of these three categories: liability, collision, or comprehensive insurance.

How long does a claim affect your home or auto insurance premium?

Five to seven years is typically how long a home insurance claim can affect your premium. For auto it's three to six years. But double check with your insurance company to confirm.

In a perfect world, you won’t have to deal with any home or car damages but that’s not reality. Sometimes things happen but that’s why you have home and auto insurance. It’s there to ensure you’re protected in the event of a loss that’s beyond your ability to cover it financially. And your insurer is there to help you every step of the way!

Find out how easy home and auto insurance can be.