When Filing a Claim Costs More Than Paying for the Repair Yourself

We tell people not to file claims fairly regularly, which is a strange thing for a shop that handles claims daily to do. But the arithmetic on a small loss frequently does not work, and pointing that out costs us nothing and saves the customer real money.

Here is how to run it.

The basic calculation

Take the repair estimate. Subtract your deductible. Subtract any betterment the carrier will apply. What is left is roughly your payout.

Then compare that payout to what you would pay directly for the same work. If they are close, you are trading a claim on your record for very little.

Worked example. A $2,800 repair, a $1,000 deductible, and 10 percent betterment because part of it is a seal replacement.

• Estimate: $2,800
• Less deductible: $1,800
• Less betterment at 10 percent of estimate: $1,520

So you receive about $1,520 and you have a claim on your record. Paying directly costs you $2,800. The difference is $1,280, which is real money, but it is not obviously worth a claim if your carrier reprices you at renewal.

Now change one number. Same deductible, $14,000 repair, same 10 percent betterment.

• Estimate: $14,000
• Less deductible: $13,000
• Less betterment: $11,600

You receive $11,600 against paying $14,000 yourself. That is not a close call. File it.

The rough thresholds

After enough of these conversations, a pattern:

• Below twice your deductible. Almost never worth filing. The payout after deductible and betterment is small and the record effect is not.
• Two to five times your deductible. Genuinely a judgement call, and it depends on your claims history and how your carrier prices renewals.
• Above five times your deductible. File it. The payout dwarfs the deductible and the premium effect.

The wrinkle on RVs is that the estimate you are running this against is provisional. A $2,800 first estimate on impact damage to a laminated wall can become $12,000 after teardown, and that changes the answer completely.

Which leads to the practical advice.

Get the scope established before you decide

This is the part most owners get backwards. They decide whether to file based on a figure written from outside a panel, then discover the real scope later and cannot easily change course.

Better sequence: get the vehicle assessed properly first, with tap testing on any laminated damage and measurement on any structural damage. Our RV systems evaluation is $150 and a diagnostic assessment is $285 per hour with a one hour minimum, both refundable as a credit against an authorized repair.

Spending $150 to find out whether you are looking at a $3,000 job or a $15,000 job before you file is obviously worth it. Filing first and finding out second is how people end up with a claim on record for a repair they could have paid for, or paying directly for a repair that should have been claimed.

What about the premium effect?

Nobody outside your carrier can tell you this precisely, and anyone who claims to is guessing. What is generally true:

• A single at fault claim usually affects renewal pricing for three years
• A not at fault claim usually affects it less, sometimes not at all
• Comprehensive claims for hail or falling objects are frequently treated more leniently than collision
• Multiple claims in a short window matter far more than one

Call your agent and ask directly. Frame it as a hypothetical if you prefer. It is a reasonable question and a decent agent will answer it.

What is not covered at all

Worth knowing before you spend $150 finding out.

Gradual failure is not covered. Sealant that degraded over six years and let water into a sidewall is maintenance, not a loss. That is the single most common declined RV claim and it is declined correctly.

Mechanical failure is not covered by an insurance policy. That is a service contract question.

Wear is not covered. A membrane at the end of its life, worn awning fabric, seals that have taken a compression set.

What is covered is sudden and accidental: impact, hail, falling objects, fire, theft, vandalism, and weather events. If your damage has a date and an event attached to it, you have a claim. If it has a slow decade attached to it, you have a maintenance bill, and no amount of arguing changes that.