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Actually Insurance companies make most of their profits off of premium float. They really do not make much if any profit off of the premium vs claims aspect. Each insurance company has what is called a combined ratio. Essentially for every dollar they bring in through premium vs how much is paid out in claims. Any number hovering around 1.00 is considered good. Most companies run a combined ratio over 1.00 so they are losing money due to claims. They make their profits by investing the premium dollars ie premium float.
Most people don't need to know that much. Just trying to simplify it to get a basic understanding.
I would never recommend filing such a small claim of $4000 with that high of a deductible.
Although… i really stress for Homeowners Insurance to use Liberty Mutual, Nationwide or Farm Bureau. The big 4 as I call it, State Farm, Allstate, GEICO and and subcontracted Progressive company… not very good. Im sure people will say “well i have xxxx and they are great!” Sure, thats anecdotal. But the reality is, they all mislead. I dont allow my parents to be insured through the ‘big 4’ and I used to work for one of them and still never had their policies.
Also dont skimp on Homeowners Insurance. I had a guy from India get a quote from when I worked at XXXX for about 550 for the year with stellar coverages and endorsements. He went with some smaller company because they were 480 a year. He had one claim when a tree fell on his room and it was $26k of damage… they denied the claim and dropped him. All over 70 a year. People are stupid. They shop Homeowners by price not quality…
My sister had Liberty Mutual when CA fires razed their house to the ground and they were amazing.
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Some insurance companies have what they call a disappearing deductible, which means that if you have enough time with no claims they will waive the deductible. It sounds as though your carrier doesn't have that.
This.
Not unless your insurance company has the "deductible reductible" or "disappearing deductible" type program.
As you sign up for any deductible..you agree you will that as the first amount towards repairs.
Want a lower deductible, you'll pay a higher premium. Want to lower your premium, agree to pay a higher deductible.
In this case, you are responsible for that amount.
Also, be aware premium s go up...often quite a bit...for any claim/s you make.
And this info is shared with other prospective insurance companies.
I'd say you'd be better off coming up with the other $1500 AND your $2500 deductible and pay out of pocket. And rescind your claim.
It's too small an amount they'll pay vs what your higher premiums may be in the future.
Insurance is a nasty business...but no mistake the insurance company always win.
Also dont skimp on Homeowners Insurance. I had a guy from India get a quote from when I worked at XXXX for about 550 for the year with stellar coverages and endorsements. He went with some smaller company because they were 480 a year. He had one claim when a tree fell on his room and it was $26k of damage… they denied the claim and dropped him. All over 70 a year. People are stupid. They shop Homeowners by price not quality…
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Insurance is not that common in foreign countries ,this Indian guy probably is not familiar with how insurance works ,$70 may mean one month worth of grocery.
Vietnamese may not even have insurance,when hurricanes hit lower TX,their boats are totaled as they have no insurance,
also many ethnic restaurants do not have insurance for their inventory when light goes out,their food get spoiled.
During hurricane Harvey,myself and my neighbors need new roof,the roofing companies are able to give us a new roof for whatever we can get from the insurance co.
How,?they use contractors who hire workers -illegal immigrants .
if I were OP,I would find someone who would do work for less,may be $3500 or $3000 ,if you tell them you have no insurance and willing to pay them cash
I agree with you. When I was 17 learning to drive, I hit my grandmother's garage door. She made a claim, they fixed the door, then promptly dropped her and covering her very old home.
The claim should have been against your auto policy. Surprised her homeowner’s would even pay it.
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