The honest answer: probably yes, but not always, and not by as much as people fear. The size of the increase depends on the type of claim, the size of the settlement, your claims history, and the insurer. Here is how the maths actually works and what you can do about it.
Why insurers raise premiums after a claim
An insurer prices your renewal based on its assessment of the risk you represent. A claim is data: it tells the insurer something about the property, the policyholder, or the loss profile of similar customers. The premium increase is the insurer’s reaction to that new data point.
How much it moves depends on:
- The cause of the claim (some perils are seen as one-off events, others as predictors of future claims)
- The settlement value (a 1,500 euro claim is treated differently to a 50,000 euro claim)
- How long you have been with the insurer and your prior claims record
- The wider market: insurers move their pricing in waves following major weather events
Claims that usually raise the premium most
Theft and water-damage claims tend to draw the largest increases because both are statistically predictive of future claims. Subsidence is the most punishing of all; once a property has had a subsidence claim, finding cover at all becomes harder, never mind the premium.
Fire claims, by contrast, are often treated as one-offs and the renewal impact is sometimes surprisingly small, particularly where the cause was clearly external (lightning strike, neighbour’s fire spreading).
Claims that usually raise the premium least
Storm claims following a named weather event spread across thousands of policyholders are usually absorbed by the insurer as expected catastrophe loss; the renewal impact is small. The same is true for flood claims in flood-zone areas where the risk is already priced in.
Accidental damage claims for one-off household accidents (a child puts a toy through the TV, a ladder dropped on tiles) are usually treated as low-frequency events and the renewal impact is modest.
How to manage the renewal after a claim
Three practical steps:
- Get a renewal quote and at least two competing quotes 30 days before the policy ends. Pricing varies dramatically between insurers for the same risk profile.
- Tell every insurer the truth about claims history. Non-disclosure voids the policy. Two insurers asking the same question can produce wildly different premiums even on identical disclosure.
- Consider whether claiming was the right call in the first place. For small claims close to the excess, absorbing the loss is often cheaper across a five-year window. For large claims, the premium impact is rarely the deciding factor.
What to do if your renewal is unaffordable
Switching insurers is usually possible. Even a property with a recent water damage claim on its history will find a market, sometimes at higher rates, sometimes not. If you are struggling to find cover at all, talk to a broker who specialises in non-standard risks before you give up.
When to call a loss assessor
Loss assessors influence the size of the settlement, not the renewal premium. Where we make the most difference for the long-term cost is by ensuring the original claim settled at the right figure, so a single bad claim does not prompt the insurer to abandon the relationship altogether at renewal.
The renewal arithmetic
If you are weighing up whether to claim or absorb a loss, the rough rule is: where the recoverable settlement exceeds two years’ worth of likely premium increase, the claim is worth making. For losses below that, the long-term cost may exceed the short-term recovery. Each insurer is different; the maths is specific to your situation.
Written by the team at N.J. Carroll & Associates, insurance loss assessors and quantity surveyors, established 1988.
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