Your insurance policy is merely a promise until you have a claim, but many people hesitate to report a claim to their insurer. Here are five reasons why you should promptly report a claim if you have an incident.
There are good reasons to report a claim promptly.
- TO ASSURE THAT COVERAGE IS NOT AFFECTED
Coverage is contingent on prompt reporting. Your policy defines specified conditions and requirements for coverage, and one of them is usually your duty to report a loss just as soon as practical after the loss occurs.
- TO HELP RESOLVE YOUR CLAIM PROMPTLY
Early investigation is vital in determining liability and damages. Obtaining key evidence, scope of damages and interviewing all parties while information is clear assures your claim is accurately assessed and given every consideration.
- TO IMPROVE SUBROGATION SUCCESS
Prompt reporting is vital when subrogation is needed to pursue a claim against the responsible party. Subrogation enables an insurance company, after paying a loss to its insured, to recover the amount of the loss from another who is legally liable for it. Prompt claim reporting makes it easier to determine facts, obtain expert reports and collect evidence early on, leading to a higher likelihood that the not-at-fault policyholder can recover the deductible. It also helps keep claim costs – and therefore insurance costs – low.
- TO PREVENT ADDITIONAL DAMAGE
By reporting your claim early, immediate remediation can prevent further damage. This ultimately lowers claim costs and helps keep premiums low.
- TO PROTECT THE ABILITY TO DEFEND A CLAIM
The insurance company has an opportunity on claims involving injury or damage to people other than the policyholder (third parties) to negotiate an early economical settlement. Late reporting could allow key evidence to be lost or destroyed, leading to a not-so-positive outcome for all parties involved. (The Ohio Insurance Institute’s glossary defines third-party coverage and first-party coverage.)
Let the insurance professionals do the work for you. You are paying a premium and deserve to have a complete policy review, inspection and investigation to determine if you have coverage.
When in doubt, ask your agent or insurance company for advice on whether to submit a claim. Always report it promptly (even as a “record only”) so you adhere to your policy conditions and duties.
Article by Carol S. Ward from Cincinnati Insurance Companies.