Fear of premium increases prevents many Texas homeowners from filing legitimate insurance claims — which is exactly what insurance companies count on. Here's what Texas law actually says about rate increases after claims.
The Truth About Rate Increases After Claims
Texas law provides some protection against retaliatory rate increases. Under Texas Insurance Code § 551.105, an insurer cannot cancel a policy based solely on one or two weather-related claims in a three-year period. However, insurers can and do use claims history as a rating factor when setting premiums.
Factors That Actually Affect Your Premium
- Number of claims filed within a policy period
- Type of claim (weather vs. liability vs. water damage)
- Whether the claim was paid or denied
- Your claims history with all insurers (C.L.U.E. report)
- Your credit history (in Texas, used as a rating factor)
The Real Risk of NOT Filing
Failing to file a timely claim can result in a denial based on late reporting. Attempting to repair damage without filing can be characterized as misrepresentation. The cost of storm damage often far exceeds the increase in premiums from filing.
What to Do If You Think You Were Penalized
If your policy was cancelled or non-renewed shortly after filing a legitimate claim, contact CDF Law. We examine whether the cancellation was improper under Texas Insurance Code provisions.