You need insurance to protect you from risks that can have profound effects on the physical state of your home, and most especially your family. While you hope you never come across any event of catastrophic proportions, you certainly would rather choose to be protected if and when they occur. But what happens if the insurance you depend on suddenly gets canceled? What would you do?
If your insurance policy is up for renewal, your insurance underwriter will thoroughly inspect your home to look out for any risks that can predispose them to large payouts. If you live in an older house or in a disaster-prone area, certain insurance companies will utilize different parameters with which to classify whether you are a high-risk client or not. And being expert risk managers, they would certainly avoid the potential of underwriting with a grave chance of losing. When they see the hallmarks of being on certain financial loss, your policy can be canceled.
What are the common reasons for cancellation?
More often than not, homeowners are aware but fail to address some of the following conditions:
Bad Roof
A roof that is 20 years or older is likely to have leaks, weak, or corroded spots that can lead to more serious issues. Leaks can damage almost anything under the roof. From wood panels, furniture, floors, and even electrical wirings. If you are too busy to have the issues resolved before the insurance inspector come into the picture, it might already be too late.
Non-Payment of Premiums
Insurance companies are businesses. The prompt payment of premiums assures that they can discharge their functions as they fulfill their commitment of providing the coverage stipulated on your policy. As your policies cover a certain period, your failure in settling the premiums means that you will not be capable of fulfilling your end of the bargain.
Structural Damage
Damages to your foundation are usually evident only after a considerable period of time. Termite infestation, cracks due to ground settling or movements that may not be readily visible especially when they are in hidden areas of the house. While these conditions may not mean negligence on your part, they can be classified as maintenance issues. And to the underwriter, any deficiency in maintaining your home spells an impending disaster.
Multiple Claims
Filing numerous claims especially due to minor causes may not be practical. While they save you the trouble of spending for specified amounts, multiple claims can mean that your home has too many risks to be covered. Any insurer will keep away from such situations.
What To Do?
If you were notified by your underwriter that your insurance policy will be canceled, you need to know what to do next. With a 45-day notice, you have more than enough time to resolve the issues that put your policy in danger of cancellation. Your promptness in dealing with the situation will determine your success in renewing your policy or your agony of losing it. Either way, taking the measures to remedy the situation all rests on your shoulders.
Payment of premiums is a close-ended matter. To have the service, you need to pay for the service. If damage to your roof or to your foundation is the issue, you need to have them resolved. You can subscribe to a third-party contractor to inspect and suggest how you can deal with them. Depending on the extent, they can be costly. But if that cost is enough for you to lose your insurance then, you don’t have any option but to have them repaired. Remedy the situation and appeal for reinstatement.
