Home insurance costs spike after lawsuits – report

“After homeowners are sued – regardless of whether they win the case or not – their rates increase by an average of 21% across the 50 states and the District of Columbia,” ValuePenguin said.

Rate changes after a lawsuit were highest in North Carolina, the study found. In the Tarheel State, rates spike by an average of 38% following a liability claim.

Post-lawsuit rate hikes were lowest in California. In that state, rates rise by an average of just 5% following a liability claim.

The study also found that it’s generally affordable for policyholders to increase their personal liability insurance to a much higher amount.

“Consumers can increase their personal liability coverage from $100,000 to $500,000 by paying rates just 2% higher, on average,” ValuePenguin said.

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Owning potentially risky property doesn’t generally raise rates significantly unless the policyholder has a history of litigation, the study found.

“Owning certain breeds of dogs increases the average cost of coverage by 1%, and so does owning a trampoline,” ValuePenguin said.

There are some notable exceptions, however. In Michigan, for instance, owning certain breeds of dog, like pit bulls of German shepherds, can raise rated by up to 25%. In Ohio, owning a trampoline can cause homeowners’ insurance rates to bounce by 10%.