Can an Auto Ins. Co. Raise Deductible Like This?

[zookeeper16]

We reside in Wisconsin and have been continuously insured for over 8 years. During the last four years, we have made four claims for damage to our vehicles, only three of which were paid out by the insurance company (we didn't proceed with the fourth claim as it was pretty minor). Out of the three claims that the insurance company had to pay out on, two were for deer damage (we hit the poor deer) and one was for hail damage.

A couple of months ago, the insurance company decided to raise our deductible from $250 to $500 because we had "four claims in four years." The insurance agent that we talked to said it was probably because the insurance company paid out more in damages than we paid in insurance.

Since we were not at fault for any of the claims for damages, can an insurance company do this? If they can't legally do this, how do I proceed? If they can do this, can you please justify why?

I appreciate your help and insight.

 

[Juan Rodriguez]

Simply put, yes.

The simplest explanaition is: An insurance policy is a contract and insurance companies are in business. You are rated based on the type of risk they are taking to insure you. If you have never had a loss or make a claim, then you are a low risk and are afforded the lowest rates. The insurance carrier is not arbitrary in assigning the risk and thus the rates. They use "underwriting guidelines". If you have X number of losses in a specific time period then the guidelines dictate if and how much your rates will go up. In your case it was just your deductable. You were lucky.