Why does a home insurance premium increase after you file claims?

I filed one claim in the past year on my home for a mold problem. At renewal, my premium almost doubled in price. Why does home insurance increase after just a sole claim?

“Just like car insurance, home insurance increases after claims because the insurance company deems you more likely to file claims in the future.
The basis of insurance is the transfer of risk. When you pay a premium to an insurance company, it goes into a premium pool. This pool is what companies use to pay for claims filed by any policyholder. If you are high-risk, an insurance company has to charge you more to offset your likeliness to file claims.
If you don’t file any additional claims, your insurance will likely begin to decrease over time. You can also look into other insurance companies. Since you’ve only submitted one claim, you may be able to find a company that is offering a better rate.
If you have a separate car insurance policy, you may also consider trying to bundle both policies to help you save money.
You can also request quotes from different insurance providers to find a lower rate. Leave the hard work of comparison shopping to the Jerry. Jerry is a free app that pulls multiple quotes and delivers the best deals to your phone in minutes.”
Eric Schad
Answered on Aug 12, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.

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