Insurance policies usually contain wording that requires the policyholder to notify the insurer as soon as the policyholder is aware of a claim. The trick is it’s sometimes hard to know if a dispute or complaint will actually become an insurance claim. A good rule of thumb is if anyone makes a demand for money or financial relief from your company, you probably are facing a liability claim and should report the circumstances that might lead to a claim to your insurer.
Reporting early allows your insurer to be better prepared to defend you if needed.
Regarding property, when you first notice damage or a missing item, you may wish to take initial action on your own, such as making immediate repairs or conducting a search for the absent property. Don’t wait too long, though, because many problems get worse and more costly if they drag on. Moreover, you can be held responsible for damage that occurs because of your delay, and that could jeopardize your coverage.
One of the great benefits of reporting an occurrence or potential claim early is your insurer can get legal counsel or repairs under way and prevent a worse outcome. Your agent or broker is a great resource, so ask questions if you are unsure of how to proceed with a claim.