Note: Check your insurance policy to make sure you’re following the contract. For some insurers you’re required to report any ‘event’, but may not have to file a claim.
When you think about any sort of situation where you’re involved in an auto incident, then your first instinct is to get the insurance companies involved.
If you’re paying all that money on auto insurance in the first place, it makes sense to have the insurance companies foot the bill for damages, right?
Running the Numbers on Auto Insurance
But thinking about it from another point of view, there are certain reasons why you may want to keep the matter internal and avoid the auto insurance companies and claims departments altogether.
Here are four cases you shouldn’t file an auto claim in:
It may be tempting to file a claim for small yet noticeable damage, but keep in mind the entire underwriting process is about trying to discover who you are as a driver – and what your driving habits are like.
Underwriters don’t just look to the severity of the claim to see what you’re doing; they also focus on the frequency of claims you make.
Therefore, if you’re going to file multiple claims you will be labeled as high risk and could eventually pay significantly higher rates as a result.
When it comes to minor damages (things like paint scratches, dingers on your car, and other non-noticeable marks), you need to be conscious of the idea that you could have major work done to get something repaired.
However, you could also be trading away significantly higher rates in the future in order to do some cosmetic touch ups in the present.
Keeping It in the Family
Insurance is nothing more than a legal contract. It is put in place to help people who do not have a prior relationship settle their legal and financial obligations to one another.
That being said, when you have a potential claim that involves a family member or close personal friend, you could theoretically solve the issue yourselves and keep the insurance companies out of it.
Paying for the repairs yourself will most likely be more affordable than paying toward your deductible and a higher premium going forward.
When you consider the fact that your future costs won’t skyrocket, it could be a very good strategy where both parties come out ahead.
Damage Below (or Near) Your Deductible
When you have a deductible of say $500 or even $1,000, you’re basically agreeing to eat that amount of any given claim.
Assuming you have a $500 deductible, if you turned in a claim worth $600 then you would only receive a refund of $100 for the claim from your insurance company.
It doesn’t make complete sense to deal with such a situation especially when it could hurt your future risk profile, does it?
The other thing to be aware of is what happens if you actually have a claim that is below your deductible.
If your claim was $750 and your personal deductible was $1,000, then the insurance company isn’t reimbursing you for anything.
In that scenario, reporting the claim might just be a way of telling them how accident-prone you are without actually getting anything back in return. In those types of scenarios, just avoid filing a claim altogether.
Your Record is Already Spotty at Best
If your current record is already spotty and you have a couple of marks going against you (prior claims, speeding tickets, late payments, etc.) it doesn’t help to add fuel to the fire.
In addition to paying an objectively high premium, you could venture into non-renewal waters.
Obviously there are some factors in any given case that you need to consider. When it comes to things like damage to the property of others or even medical bills, then it’s wise to file a claim because to go without it would be financially crippling.
If you do get to the point of being non-renewed by your insurance company though, don’t lose hope, these days it’s easy to compare auto insurance without the pain of dialing each individual company for a quote.
In the end, use your best judgment when filing a claim. By assuming that anything happening to your vehicle is grounds for a claim, you’re only sealing your sky-high future premium fate.
Learn how to analyze YOUR situation and YOUR house so you can get the money you need.
Understand Why You’re Selling
One of the first things you can do to help you determine when is the best time to sell is going over exactly why you want to sell your house in the first place.
Besides giving your an idea of what to look for in your next home, you can also get a better idea of the type of person or family that would find your house the perfect fit.
Perhaps you bought your house years ago, excited to be at a location where you could walk over to any number of community events.
However as your situation changes and your family expands, you find your space a bit small for your needs and it’s too far from the schools you like.
You now have something to add to your buying checklist (good schools, bigger space), but you also have a selling point and a possible niche – singles and couples without kids looking to be in the middle of the action.
When you get ready to stage the house, you know that’s what you’ll be highlighting to potential buyers.
Look at the Numbers That Really Matter
Most of us have emotional ties to our homes. It’s more than a shelter for us, it’s a place where we’ve made memories.
BUT…. Selling a house is not about your sentimental feelings.
Selling a house is best handled as financial decision. To help minimize personal bias, it’s vital to look at the numbers.
Here are a few important ones you should have an idea on before you sell your house.
Your City’s Growth
With the numbers, you can see whether or not people are moving into your city.
Growth can mean more potential buyers (though not a slam dunk as your specific location in the city plays a huge role) which can mean more money for you when you sell. If people are fleeing your city, don’t expect to get top dollar for it.
Being aware of what homes have sold for in your area is extremely handy. Look at the most recent comps (comparable homes) that have been sold in your neighborhood.
You can use resources like Zillow and Realtor to find the numbers.
If buyers seem to think homes in your neighborhood are worth a certain amount, then you have to have some fantastic features to convince them to pay more for your house (or more than likely, lower your expectations).
Minimum Sale Price
While it’s important to be flexible, you two should have a minimum sale price in mind. When an offer comes in, it’s easier o make a decision if you know what you’re looking for.
If you’re planning on buying on another house, it does help to have a large down payment to avoid private mortgage insurance.