When to File — or Not File — an Insurance Claim

When to File — or Not File — an Insurance Claim

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In today's stringent insurance market, condo board members, along with property managers, must carefully evaluate their claim-filing processes. Insurance carriers are increasingly selective about the risks they insure, with claims being a pivotal factor in their decisions regarding coverage renewal or new policies. Boards should consider six key points before filing a claim:

1) The property's recent claim history significantly influences insurer perceptions; large "shock losses" are often preferred over multiple smaller claims.

2) In the current market, it may be wise to refrain from filing claims for payouts under $5,000 to avoid negative impacts on future premiums.

3) Coverage extends primarily to sudden and accidental losses, excluding damages from wear and tear or lack of maintenance.

4) While agents can offer opinions, only filing a claim confirms coverage.

5) Claims below the policy deductible shouldn't be filed, as carriers won't make payments below this threshold.

6) Consulting a trusted contractor to assess damages and estimate costs can help determine if filing a claim is warranted.

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