What’s an insurance claim?
“Filing a claim” is how you request benefits from your insurer after a covered loss. Today the process commonly starts online or in an app and includes guided intake, photo/video uploads, virtual inspections, and even instant digital payments for eligible losses — all of which have expanded recently and help close straightforward claims faster (CCC Crash Course 2025; Deloitte 2025 Insurance Outlook; Mastercard Send). The end goal is the same: securing funds to repair a home, fix a car, or pay medical bills — without paying the entire loss yourself. For context, large catastrophic home losses can run into the tens of thousands (e.g., “$80,000 to repair it”), but your policy and deductible determine what’s actually paid.
How does the insurance claims process work?
Real claims require documentation, an adjuster’s review, and sometimes appraisal, mediation, or other dispute steps before payment. The good news: digital first notice of loss (FNOL), photo estimating, and remote inspections have shortened timelines for many low‑complexity auto and property claims as these tools scaled in 2024–2025 (CCC Crash Course 2025).
The first thing to know is that the claims process varies by insurance type (home, auto, health, life, etc.). We’ll focus on homeowners and auto, but note: clean Medicare health claims are generally paid within 30 days (CMS prompt‑pay standards), and the latest life insurance statistics show median time‑to‑decision of days to low‑weeks for death claims, weeks for income protection, and months for total and permanent disability due to complexity (APRA life claims statistics).
Claims for homeowners and car insurance generally move through four steps before payment:
- Step 1: Make the right phone calls.
If you’ve had a crash or a crime-related loss, contact the police. Then notify your insurer as soon as possible — by phone, web, or app. Many carriers now support digital FNOL and even telematics- or sensor-triggered FNOL for faster triage (CCC Crash Course 2025). - Step 2: Fill out the required forms.
Most insurers offer guided online claims with photo/video upload, secure messaging, e‑sign, and status tracking. Increasingly, insurers use carefully governed AI to prefill and route claims while keeping humans in the loop for complex cases; regulators expect strong oversight of these tools (NAIC AI Model Bulletin; Deloitte 2025 Outlook). - Step 3: Get damages assessed.
Insurers validate damages using photo estimating and virtual inspections for simpler losses, or through approved body shops and on‑site adjusters for complex claims. Expanded use of these tools has improved estimate turnaround for many repairable auto claims (CCC Crash Course 2025). - Step 4: Cover your deductible.
Most first‑party claims (other than liability payouts to others) require you to pay a deductible. In homeowners, expect peril‑specific deductibles in many regions — e.g., separate hurricane or wind/hail deductibles often set as 1–5% of the dwelling limit — while many drivers are choosing higher auto deductibles to control premiums (NAIC catastrophe deductibles; Triple‑I hurricane deductibles; TransUnion 2025 personal lines trends).
How long does it take to settle a claim?
Time to settlement depends on severity, documentation speed, adjuster/repair capacity, and whether a catastrophe (CAT) surge is in play. Current benchmarks provide realistic guardrails: repairable personal‑auto claims commonly resolve in weeks, with shorter cycles for simple, digital‑eligible losses (J.D. Power 2024 auto claims; CCC Crash Course 2025). For homeowners, simple water losses often close in weeks, while complex fire/structural claims can run months; CAT surges still create episodic backlogs (FCA value measures: average claim duration (days)). Medicare Fee‑for‑Service pays clean electronic claims in about 30 days (CMS). Life‑insurance median decision times differ by product — death: days to low‑weeks; income protection: weeks; TPD: months (APRA). In workers’ compensation, the first temporary‑disability payment typically arrives two to three weeks after injury, varying by state (WCRI).
Legal escalation can extend timelines and increase costs. Many property and auto disputes are resolved through appraisal or mediation; in health claims, surprise‑billing disputes are routed to the federal IDR process under the No Surprises Act with strict filing windows (CMS No Surprises Act IDR). Litigation patterns and large verdict risks continue to pressure severity, so early, well‑documented coverage decisions and proactive negotiation help reduce disputes (Lex Machina Insurance Litigation Report; Swiss Re Institute; Allianz Global Claims Review; ILR research).
Pro tip: Check out companies’ claims records before you buy insurance. Survey groups J.D. Power and Consumer Reports publish current claims experience by brand; J.D. Power also rates homeowners claims in its latest property study (2025 Property Claims). Cross‑check with your state’s complaint ratios via the NAIC complaint index before you choose a policy.
When should I make a claim?
File when damages clearly exceed your deductible and you can’t comfortably cover the loss yourself. Small, at‑fault auto claims can cost more over time: a single at‑fault accident raises the average U.S. premium by roughly the mid‑40% range at renewal, and surcharges often last multiple years (The Zebra 2025). Homeowners policies in many regions carry separate wind/hail or hurricane deductibles set as a percentage (often 1–5%) of Coverage A, so smaller roof or wind losses may fall below those thresholds (NAIC; Triple‑I). If the damage is only slightly above your deductible, consider paying out of pocket to preserve claims‑free discounts and avoid multi‑year surcharges (example: accident‑free discount).
Why is it bad to file multiple claims?
Any time you file an auto or homeowners insurance claim, that information gets registered on your personal insurance report card. Insurers review this history when quoting or renewing. Multiple surchargeable or at‑fault claims typically remove loss‑free discounts and add surcharges, which stack across incidents — especially in auto. Claims are also widely visible to carriers via CLUE for about seven years, which limits opportunities to “reset” by switching (LexisNexis CLUE).
Current market data show carriers weigh prior loss frequency heavily in pricing and eligibility. One at‑fault auto accident often increases premiums around 45% on average; a second within the experience window can push combined surcharges toward a doubling of premium or prompt underwriting review (The Zebra 2025). In homeowners, multiple non‑catastrophe claims can trigger sizable price increases and, in some markets, a nonrenewal review — while many states restrict action based solely on weather‑related claims (LexisNexis Auto Trends 2025; LexisNexis Home Trends 2025; Texas DOI guidance).
Insurance is there for significant losses — use it thoughtfully. Preventing and documenting losses (e.g., dashcams, water‑leak sensors) and choosing a deductible you can afford are practical ways to limit small claims and protect your long‑term pricing (TransUnion 2025).
Will my policy be canceled if I make too many claims?
Filing multiple large claims within a short period can lead to nonrenewal at expiration (i.e., the company chooses not to offer another term). Insurers commonly review a 3–5 year experience window for surchargeable auto accidents, with state rules shaping exactly how long surcharges last (for example, California rating typically uses the most recent three years, while Massachusetts keeps SDIP points for six years). In homeowners, multiple non‑weather claims can trigger nonrenewal reviews in some markets, while many states restrict action based solely on weather/CAT claims (California rating framework; MA SDIP; Texas DOI).
Notice timing and reasons are governed by state law. Many states allow broader cancellation only during roughly the first 60 days of a new policy; after that, mid‑term cancellation is generally limited to specific causes like nonpayment, material misrepresentation, or license suspension (auto). Homeowners nonrenewals often require longer advance notice — e.g., California requires at least 75 days for homeowners — and some states implement disaster‑related moratoriums on nonrenewals in declared areas (NY Insurance Law §3425; California §678.1; CA wildfire nonrenewal moratoriums).
It’s important to note that nonrenewal is not the same thing as cancellation. Policies are generally only cancelled mid‑term for limited reasons like nonpayment of premium or material misrepresentation, and states prescribe notice requirements. At renewal, insurers may change terms or nonrenew coverage subject to state rules (e.g., minimum notice periods and restrictions on using certain claim types). If a consumer report (credit‑based insurance score, CLUE, MVR) contributes to a cancellation, nonrenewal, or conditional renewal, you should receive an adverse‑action notice with your rights to obtain and dispute the report (for two reasons; NY §3425; CFPB adverse‑action notice).
How long does a claim stay on my record?
For pricing and eligibility, insurers typically review about the last three to five years of claims/violations, but state programs differ — e.g., California commonly uses a three‑year look‑back for rating, while Massachusetts’ SDIP applies surcharge points for six years (California; MA SDIP). News coverage has long noted that about three years is a common benchmark for when prior claims stop affecting many policies, for about three years. Separately, claims are generally visible to insurers via CLUE consumer reports for roughly seven years, and any provider can access that history when you apply for coverage (for seven years).
What’s next?
- Still wading through the car insurance basics? Start with our complete auto insurance buyer’s guide — and while you shop, check current claims scores (e.g., J.D. Power auto claims) and your state’s complaint ratios (NAIC complaint index).
- You can also learn more about top car insurance providers in the market and start comparing prices with our review of the best car insurance companies.
