Should I file a claim? Please help!

Question

Hello,

We were out of town and our neighbors check on the heat etc at home when we are away. This time, when we were gone on vacation, our neighbors opened the kitchen sink faucet very little because it was freezing cold. Apparently when they came after 1 day, they found that the whole floor was flooded with water; the P-trap under the sink was leaking. They immediately dried the floor and cleaned it up. The water apparently made its way down into the basement and the ceiling tiles in the basement right under the kitchen floor has come out in several spots and the carpet in the basement got wet completely. A flooring expert was called and we have been drying the kitchen and the basement since couple of days using industrial dehumidifiers and fans. The flooring guy thinks everything is ok now but the hardwood floor needs refinishing. This will cost me a little over my deductible of $1500.00 (deductible $1000.00). I have so far not discussed with my insurance company. Not sure if this is a good idea? Should I file a claim? This would be my first claim. I am worried if they would increase my rate as they are already high. Please suggest!.

Account Closed · Answer

if you can afford it pay yourself  for $500 you are risking insurance raising your rates or dropping you, also if you tried to change insurance companies they look to claims for 3 years

Adam Johnson · Answer

I agree with Account Closed , don't make the claim.  If you get profiled negatively future insurance costs can go up and it can become harder to find a carrier.

This brings me to running faucets to prevent freezing pipes.  This is NOT a good idea at all.  Running water does freeze and you also run the risk of frozen sewer pipes.  You are safer shutting off the water supply at the source if you are going to be away and maintaining heat to protect the system.  You could go a step farther and drain the lines, or even better, blow compressed air through the water lines (after water is off) to clear them of water.

Jeff Rabinowitz · Answer

@John Jeff, welcome to BP. You haven't filled out your profile yet so I can't tell what attracted you to this site but if you own rental properties or plan to own rental properties in the near future you know (or will learn) that insurance is a large expense. When you acquire 1/2 dozen, or more, properties you can begin to get some discounts when you purchase all of your insurance through one agent and increase deductibles but it is very much worth the effort to keep the premiums low. Making a small claim may, indeed, raise your premium. Worse, it may raise the premium for all your properties. $100  annually for 10 properties is $1,000. Worse still, if you experience another loss in the near future and make another claim your insurance company may drop your coverage. There are not always a lot of choices when you seek companies to insure a rental portfolio. I would not make this claim.

Jeremy Shepherd · Answer

I would pay for it and write it off on my taxes.

BreAnn Stephenson · Answer

I am late to the game here, but just wanted to agree with those who have said to not file a claim in this case.  $500 more is a small amount to pay out of pocket rather than risk premiums going up.  They might not drop you for your first small claim, but claims frequency is a big factor in determining renewal rates or if they choose to renew you at all.  We would rather see one large claim from an unavoidable cause (tree falling for ex.) than a string of small ones.

@Adam Johnson has a great point about shutting the water off.  If a property is going to be vacant for a significant period of time it is best to shut the water off at the street and drain the system.  Even if you are keeping the heat on to at least 55 degrees, it still could go off during a storm and cause pipes to freeze.  Pouring environmentally-safe anti-freeze down the drains and in toilet bowls and tanks can keep water remaining in the P-traps from freezing as well.

I do want to commend you for having your neighbors check on the property.  If you hadn't had them checking, you could have been in for even more damage.  It's always a good idea to have neighbors check on your properties, even if you aren't going to be out of town.  Encouraging tenants to form relationships with neighbors or introducing them to the neighborhood is also a great way to encourage the neighborhood to look out for one another.

Best of luck with your investing!

-BreAnn

John Jeff · Answer

Hello All,

Thank you very much for your valuable suggestions. This was very helpful. Appreciate all your time and effort to answer my query.

@Jeef Rabinowitz; Yes I am a newbie and have almost decided on a rental property. Just joined this immensely resourceful forum. Hoping to learn a lot here..

Thanks again!

Colin B. · Answer

I agree with pretty much everyone, John, and would suggest that you not make a claim. Another consideration on top of what others have said is that you are also potentially going to have to argue with your insurance company, depending on how reputable your insurance company is and what your policy says, to even get that $500.

Elizabeth Colegrove · Answer

For that little I wouldn't want to raise my raises over $500.

Mark Brogan · Answer

dont worry about them raising your rates that is what you have paid insurance for many years for in case you need it the estimates to repair your house will be crazy but that is the insurance companies problem if they raise your rate just find new insurance company you should be checking insurance rates often anyway since they can vary a great deal good luck

Should I file a claim? Please help!

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