One silver lining: money expert Clark Howard and other media members have brought attention to ways to avoid making the cost problem worse.
More specifically, Clark often talks on his podcast about avoiding small claims. Raise your deductible as high as you're able to based on your emergency fund and what your lender will allow. And avoid filing small claims such as a cracked windshield on your vehicle.
Any claim will go on your insurance record and likely impact your premiums. Conversely, that’s why raising your deductible works. You’re signaling to your insurance provider that you’re less likely to file a claim unless it’s for something catastrophic (for example: you total your car in an accident or your home gets destroyed by a tornado).
But did you know calling your insurance provider to ask a question can lead to them making a note on your record? That took at least one Clark listener by surprise recently.
Can My Insurer Hold a Zero-Dollar Claim or a Simple Question Against Me?
Can my insurance company penalize me if I ask about an issue but never file a claim?
That’s what a Clark listener recently asked.
Asked Robert in Texas: "I called my insurance company to ask a general question about a home repair, and specifically stated that I will not be filing a claim and just fixing the problem.
"Amica added the claim to my file but stated nothing paid out. Does this affect my future rates or my ability to shop for insurance?"
First, Clark noted that nearly a century ago, Congress decided individual states regulate their own insurance industries.
“So in some states, if you do an inquiry with an insurance company, and it results in what they refer to as a zero-dollar claim, it has no impact on you,” Clark says.
“In other states, a zero-dollar claim is treated exactly like a claim that could’ve been for thousands of dollars and will harm you.”
If you call your insurance company as Robert did, they know who you are by your phone number. So asking a question can lead to a claim that goes on your record. Other insurance providers can access those records if you shop around.
“I have no idea [state-by-state] if a zero-dollar claim can be used against you,” Clark says. “It’s crazy that such a thing would be. You should be able across the 50 states to call your insurer that supposedly is there for you when the chips are down and ask them a question. And it’s insane [that] you can’t.”
Texas Insurance Companies Can’t Penalize You For Zero-Dollar Claims
Christa, who produces Clark’s podcast among other roles, found some clarity on the Texas Department of Insurance’s official website.
Says Christa: “It says, ‘Home and auto companies can’t charge you more for claims that you file and the company didn’t pay. This includes claims your insurance company denied because your policy doesn’t cover the damage. And for calling your company or agent to ask questions about your policy or the claims-filing process.’
“And also, they can’t charge you more for claims for damage for natural causes including weather.”
In other words, Robert’s insurance company may add his phone call asking a home repair question to his records. But because he lives in Texas, his premiums aren’t legally allowed to increase as a result.
Clark: Be Wary of Conversations With Your Insurer About Real-Life Issues
Sadly, the caricature of your friendly neighborhood insurance agent who’s there for you whenever you call often is a misnomer. You have to be careful about contacting your insurance provider for any related issue, whether or not you’re filing a claim.
Clark’s son recently watched a rock crack his car windshield. He needed a new windshield as a result.
“And in getting quotes, they’d always ask. Each of the glass companies would say, ‘With insurance? Without?’” Clark says.
“So all I wanted to know was if we used the preferred provider from our insurer, would we be eligible for the negotiated price that they have, even though we’d be paying?
“I didn’t make that call because I didn’t want to generate a zero-dollar claim. And why should it be like that?”
Final Thoughts
Calling your insurance company to ask about an issue can turn into a zero-dollar claim. That means, even though your insurance company didn’t pay out a cent — and you may not have even filed a formal claim — it goes on your insurance record.
Depending on what state you live in, it may even be legal for your insurance provider to raise your premiums as a result.
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