Can Your Insurance Carrier Drop You?

The short answer is yes.

Insurance carriers have dropped client and will continue to do so.

But the more important question might be why.

Why would your insurance carrier drop you? What circumstances and conditions must exist?

Reason Your Insurance Carrier May Cancel Your Policy

1. Non-Payment

The most obvious is when you don’t pay your premiums. Much like any other service-oriented business, consistent non-payment may stop service. Insurance carriers are no different.

If you’ve accidentally gotten behind on your payment, you can oftentimes call your carrier to negotiate a payment schedule to get back on track. They want you as a customer as much as you need the insurance.

2. Dishonesty

When you first sign up for a policy, most carriers have a period of 60 days where they can drop you for no reason. This is often the result of finding discrepancies in your application.

While many people believe lying may lead to cheaper premiums, insurance companies will always find out (sooner or later).

3. High-Risk Policyholders/Policy Violators

An insurance carrier survives by hedging off risks, therefore, risky clients can be dropped. A homeowner that has a history of suspicious house fires or recurring water leaks may be at risk for cancellation.

A homeowner that consistently violates insurance policies will be at high risk for being dropped as well.

Therefore it is extremely important to be a “good” policyholder in keeping up with your house and showing yourself not to be a potential liability.

4. Excessive Claims

Though your claims may be warranted an insurance company has the right to cancel you if the claims are excessive.

Additionally, these claims may not even have to be related. For instance, you lost your wedding band in December, got in a car accident in February, and got hit by a hailstorm in April. These are all valid claims, however, an insurance carrier sees the liability in insuring you and therefore can drop you.

Tip: It is illegal for them to change your premiums after a claim. They can, however, change your rates when your policy is up for renewal.

Summary

So can your insurance carrier drop you? You bet they can.

Getting dropped from your policy is rare although it can happen. We encourage policyholders to reach out to their insurance carrier when this happens to work it out.

If you fear to be at risk for being dropped, call your insurance agent to discuss some options now.

Lastly, if you more insurance questions as it relates to roofing, we can absolutely help answer those. Give us a call at (402) 889-3381.