Insurance Claims: When to Claim vs. Not Claim



Understanding when to file insurance claims – and when it might be wiser to refrain – is crucial in navigating the often complex world of insurance. 

In this article, we’ll delve into the essentials of insurance claims, from recognizing what constitutes a claim to discerning the types of claims that arise in both personal and business contexts. 

Whether you’re facing significant damage or loss, grappling with legal obligations, or simply weighing the costs of minor repairs, our guide aims to provide clear insights and actionable advice. 

Welcome to Peachy Insurance, where our mission is not only to offer comprehensive insurance solutions but also to guide our clients through every step of their insurance journey. With Peachy Insurance by your side, you can make informed decisions that safeguard your financial stability and ensure your peace of mind. 

Not a client? No worries. This advice is always applicable, and you should always check with your insurance agent before filing a claim.

Now, let’s explore the intricacies of when to make a claim, and just as importantly, when not to.

We believe in giving you value right away, so here are some key takeaways from this article. Read further for much more detail.

Key Takeaways from This Article

  • Evaluate the Extent of Damage vs. Deductible: Before filing a claim, assess if the cost of repair or loss is significantly higher than your deductible. If it’s only marginally higher, it might be more cost-effective to handle the expenses out-of-pocket.
  • Understand the Impact of Claim Frequency: Frequent claims, even for minor issues, can lead to higher premiums and affect future insurability. Consider handling minor repairs independently to maintain a favorable insurance record.
  • Choose Your Deductible Wisely: Select a deductible that balances your ability to pay out-of-pocket costs with your willingness to pay higher premiums. Higher deductibles generally lead to lower premiums, but require more financial readiness for potential claims.
  • Consult with Your Insurance Agent: Leverage the expertise of your insurance agent to understand the intricacies of your policy, the viability of a claim, and its potential impact on your premiums and coverage.
  • Consider Legal and Liability Implications: In situations involving legal obligations or potential liability (like auto accidents with legal liability or business-related incidents), it’s often necessary to file a claim to protect against legal and financial repercussions.

The Basics of Insurance Claims

Understanding the fundamentals of insurance claims is essential for anyone navigating the world of insurance, whether it’s for personal or business purposes. 

In this section, we’ll define what an insurance claim is and explore the various types of claims commonly encountered.

Definition and Explanation of an Insurance Claim

An insurance claim is a formal request made by a policyholder to their insurance company for coverage or compensation for a covered loss or policy event. 

Essentially, it’s the mechanism through which an insured person or entity seeks to apply their insurance coverage to a particular situation. 

The process begins when the policyholder experiences a loss or damage that is potentially covered under their insurance policy. 

This could range from a car accident to home damage, or even a liability claim against a business. 

The insured must then notify their insurance company of the incident and provide necessary documentation and proof of loss. 

The insurance company will assess the claim to determine whether it falls within the policy’s terms and, if so, the extent of the compensation or repairs to be provided.

Types of Claims Commonly Encountered in Personal and Business Insurance

Personal Insurance Claims:

Auto Insurance Claims: These arise from accidents or damages involving vehicles. Claims can be for physical damage to the insured’s vehicle, or liability claims if the insured is responsible for damage or injury to others.

Homeowners Insurance Claims: These claims are related to damages to one’s home or personal property, often due to natural disasters, theft, or vandalism.

Health Insurance Claims: These involve requests for coverage of medical expenses due to illness or injury.

Life Insurance Claims: These are made upon the death of the insured, where the designated beneficiaries receive the policy benefit.

Business Insurance Claims:

Property Insurance Claims: Similar to homeowners insurance, but for business properties, covering damages from fire, natural disasters, or other perils.

Liability Claims: These are claims made against a business when it is held liable for injury or damage to a third party, including product liability and professional liability claims.

Workers’ Compensation Claims: Arise when employees are injured or become ill as a direct result of their job.

Business Interruption Claims: Made when a business must halt operations due to covered events, seeking compensation for lost income and other expenses.

In both personal and business contexts, the nature of the claim can significantly vary depending on the specifics of the policy and the circumstances of the event. 

It’s crucial for policyholders to understand their coverage details to effectively utilize their insurance when needed. 

At Peachy Insurance, our commitment is to ensure our clients have a clear understanding of these processes, empowering them with the knowledge to handle insurance claims confidently and effectively.

When to Make a Claim

Deciding when to file an insurance claim can be a pivotal moment in managing both personal and business risks. Two primary situations where filing a claim is generally advisable are in cases of significant damage or loss, and when legal obligations and liability issues are involved.

In Cases of Significant Damage or Loss

Examples of Scenarios Where Filing a Claim is Recommended:

Severe Property Damage: For instance, substantial damage to your home from a natural disaster like a tornado or a fire that results in major repair or rebuilding needs.

Major Auto Accidents: Involving significant vehicle damage or bodily injuries, especially when the repair costs exceed the policy’s deductible by a large margin.

High Medical Expenses: In cases of serious injuries requiring extensive medical treatment, where health insurance can help cover high costs.

Significant Business Losses: Such as major damage to business property or a liability lawsuit that could significantly impact the company’s finances.

Situations Where Legal Requirements Necessitate a Claim:

Auto Accidents with Legal Liability: When you’re legally obligated to cover damages or injuries to others, especially in states with at-fault insurance laws.

Business Liability: If your business is legally responsible for customer injuries or property damage, or if faced with professional liability claims.

Mandated Reporting Situations: Certain incidents, like workplace injuries (under workers’ compensation insurance), legally require you to file a claim.

Understanding Liability and Its Implications on Claim Decisions:

Protection from Legal Action: Liability insurance provides defense and coverage against lawsuits. Not filing a claim can leave you financially vulnerable to legal judgments.

Navigating Fault and Responsibility: Liability claims can be complex, involving the determination of fault and responsibility. Insurance companies have expertise in handling such situations, which can be invaluable.

Impact on Future Coverage: Liability claims can affect future insurability and rates. Understanding the implications can guide better risk management and policy choices.

In both scenarios, the decision to file a claim should be balanced with an understanding of your policy’s terms, the potential impact on future premiums, and the immediate need for financial or legal protection. 

At Peachy Insurance, we are here to help our clients navigate these decisions, ensuring they are making the most informed choices in their insurance journey.

When Not to Make a Claim

There are several circumstances in which it might be more advantageous not to file an insurance claim. 

Understanding these scenarios can help in making informed decisions that could save you money and prevent potential complications with your insurance policy in the long term.

Getting an Estimate: Damages Versus Deductible

Before filing a claim, it’s crucial to get an estimate of the damages. 

If the cost of repair is less than or only slightly above your deductible, it might be more economical to cover the expenses out-of-pocket rather than filing a claim.

Permanence of Claims

Remember that once filed, claims cannot be deleted or removed from your insurance history. 

This permanence can influence your insurance record and potentially your future premiums.

Considerations for At-Fault Claims

Filing an at-fault claim can lead to a surcharge on your policy, possibly up to 30%. 

These surcharges can stay in effect for up to three years and may follow you even if you switch insurance carriers.

Handling Not-At-Fault Claims

For not-at-fault claims, it’s often recommended to go through the at-fault party’s insurance. 

This approach typically incurs no out-of-pocket expenses.

Filing through your policy for a not-at-fault claim still means you’re responsible for your deductible. 

Your insurance carrier might pursue reimbursement from the at-fault party’s insurer through subrogation, a process that can be lengthy and is not always successful.

Obtaining a police report indicating the other driver’s fault is crucial in these cases.

Minor Incidents and Repairs

In scenarios where the cost of repairs is less than the deductible, filing a claim may not be financially beneficial.

Consider the long-term cost-benefit analysis of small claims. Frequent, minor claims can lead to increased premiums over time.

Frequency of Claims

Frequent claims, even minor ones, can impact insurance rates and future insurability. Insurers often view frequent claimants as higher risks.

Develop strategies for managing minor issues without filing a claim. 

This might include setting aside a contingency fund for small repairs or increasing your deductible to lower your premium, making smaller, infrequent claims less financially burdensome.

In summary, while insurance is there to provide financial protection in times of need, not every situation warrants a claim. 

At Peachy Insurance, we advise our clients to carefully evaluate the cost and benefits of filing a claim, considering both the immediate financial implications and the long-term impact on their insurance policy. 

If in doubt, it’s always wise to consult with your Peachy Insurance agent who can provide personalized advice tailored to your specific situation.

The Role of Deductibles in Decision Making

Understanding the role of deductibles in your insurance policy is crucial in making informed decisions about when to file a claim. This section explains how deductibles work and offers strategies for choosing the right deductible for your policy.

Explanation of How Deductibles Work

A deductible is the amount you pay out of pocket before your insurance coverage kicks in. 

It’s a crucial part of your insurance contract. Deductibles can vary significantly depending on the type of insurance and the policy you choose. For instance:

In auto insurance, if you have a $500 deductible and suffer a loss that costs $2,000 to repair, you’ll pay the first $500, and your insurer will cover the remaining $1,500.

In health insurance, deductibles might be annual, meaning you pay a certain amount each year before your insurance starts paying for covered services.

Higher deductibles generally result in lower premiums, as you’re assuming more of the risk yourself. However, it also means that you need to be prepared to pay more out-of-pocket in the event of a claim.

Strategies for Choosing the Right Deductible for Your Policy

Assess Your Financial Situation:

Evaluate your savings and financial stability. Opt for a higher deductible if you have sufficient savings to cover larger out-of-pocket expenses in the event of a claim.

Consider Your Risk Tolerance:

If you prefer minimal out-of-pocket expenses at the time of a claim, a lower deductible might be better, despite the higher premiums.

Conversely, if you’re comfortable with the potential of larger out-of-pocket costs, a higher deductible can save you money on premiums.

Analyze Past Claim History:

If you have a history of few or no claims, you might opt for a higher deductible, banking on the likelihood that you won’t need to file a claim.

If you’ve had multiple claims in the past, a lower deductible might be more prudent, although this will result in higher premiums.

Understand the Nature of Your Coverage:

Different types of coverage within the same policy can have different deductibles. For example, in a homeowner’s policy, the deductible for standard repairs might differ from that for natural disaster damage.

Review and Adjust Regularly:

Your financial situation and coverage needs can change over time. Regularly review your policy and adjust your deductibles accordingly.

Choosing the right deductible is a balance between what you can afford to pay out-of-pocket and how much you’re willing to pay in premiums. 

At Peachy Insurance, we encourage our clients to thoroughly understand their deductibles and how they impact their overall insurance strategy. 

By carefully selecting your deductible, you can ensure that your insurance policy is both affordable and effective in protecting you against financial losses.

Consulting Your Insurance Agent

Navigating the complexities of insurance claims can be challenging. 

This is where the expertise and guidance of an insurance agent become invaluable. 

At Peachy Insurance, we strongly advocate for consulting with an agent before proceeding with a claim, ensuring that you make the most informed decision possible.

The Importance of Consulting with an Agent Before Making a Claim

Expert Advice on Claim Viability

Your agent can help assess whether filing a claim is in your best interest, considering the nature of the incident, your policy details, and potential impacts on future premiums.

Understanding Policy Coverage

Insurance policies can be complex. An agent can clarify what is and isn’t covered, helping to avoid surprises during the claims process.

Assistance with Estimates

Agents can provide guidance on getting repair estimates, which is crucial for comparing against your deductible and determining the financial feasibility of a claim.

Navigating Policy Details

They can help you understand specific policy terms, such as deductibles, coverage limits, and exclusions, which are crucial in making an informed claim decision.

How Peachy Insurance Agents Can Assist in Making Informed Decisions

Personalized Consultation

Peachy Insurance agents understand that every situation is unique. They offer personalized consultations tailored to your specific circumstances and coverage needs.

Streamlining the Claims Process

In the event that a claim is necessary, agents can guide you through the process, ensuring all necessary documentation is complete and accurate, which can expedite the process.

Advocacy and Support

Our agents act as your advocates, representing your interests with the insurance company. They work to ensure that you receive fair and prompt handling of your claim.

Long-term Strategy Planning

Beyond individual claims, agents can assist in strategizing your long-term insurance plan, including reviewing and adjusting coverage as your needs evolve.

Educational Resources

Peachy Insurance agents provide valuable educational resources, helping you understand the intricacies of insurance and how to make it work best for you.

Risk Assessment and Management

They can help you assess potential risks and suggest ways to mitigate them, possibly reducing the frequency and severity of future claims.

In summary, consulting with a Peachy Insurance agent before making a claim can provide you with a clearer understanding of your policy, a more straightforward claims process, and greater peace of mind. 

Our agents are here to ensure that your insurance experience is as smooth and beneficial as possible, helping you navigate every step with confidence and ease.


Navigating the decision of when to file an insurance claim can significantly impact your financial well-being and insurance experience. Throughout this article, we have explored the crucial factors that should guide this decision-making process.


When to File a Claim:

  • File a claim in cases of significant damage or loss, where the costs far exceed your deductible and impact your financial stability.
  • Legal obligations and liability issues often necessitate filing a claim to protect yourself from potential legal and financial repercussions.

When Not to File a Claim:

  • Refrain from filing a claim for minor incidents where the repair costs are below or marginally above your deductible.
  • Consider the long-term impact of frequent claims on your insurance premiums and future insurability.
  • Understand the implications of at-fault versus not-at-fault claims, particularly in terms of policy surcharges and the process of subrogation.

The Role of Deductibles:

  • Deductibles play a pivotal role in your claim decision. Balancing your deductible with your premium costs and financial capability is essential.

Consulting Your Insurance Agent:

Consulting with a Peachy Insurance agent before filing a claim can provide invaluable insights and guidance, ensuring that you make a decision that aligns with your best interests.

At Peachy Insurance, our commitment extends beyond providing insurance solutions. 

We are dedicated to offering expert guidance and support at every step of your insurance journey. 

Our goal is to empower you with the knowledge and resources needed to make informed decisions about your insurance claims. 

We understand that each situation is unique, and our experienced agents are here to provide personalized advice, tailored to your specific needs and circumstances.


In conclusion, whether or not to file a claim is a decision that should be made with careful consideration of the immediate situation and the long-term implications. 

By understanding the nuances of your insurance policy and seeking the advice of our knowledgeable agents, you can navigate these decisions with confidence and clarity, ensuring that your insurance works effectively for you. 

At Peachy Insurance, we stand ready to assist you in making the most informed and beneficial choices for your insurance needs.

We’re Here to Help

Your journey with insurance doesn’t have to be a solo venture. At Peachy Insurance, we are more than just your provider – we’re your partners in navigating the complexities of insurance claims. 

Before making a decision about filing a claim, let our experts provide you with personalized advice that aligns with your unique needs and circumstances.

Don’t hesitate – reach out to Peachy Insurance today. Let us guide you, ensuring that your next step is the right one.

Call us first, so we can advise you before you file a claim. (404) 600-1660

Andrew Filar

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