Global Courant
Many people think it’s up to them whether they want to cancel their policy, but that’s not entirely true. You can be canceled by your insurance company, usually for one of three reasons:
1 – Non-payment of premium.
2 – Misrepresentation or fraud in your insurance application.
3 – An increased risk due to your original application.
Typically, an insurance company will allow you to cancel for almost any reason within the first 30 days.
When you stop paying your premium within the set payment plan, your policy will of course be cancelled. They can also cancel your policy if you misrepresent the facts on your insurance application. So if you tell them you don’t use your car for business when you do, your policy could be cancelled. And if the exposure increases, for example you let your home fall into disrepair, the insurer can cancel your policy. In this circumstance, most carriers will allow you some time to make the necessary repairs.
The other point to remember is that insurance companies can “not renew” your policy. So instead of canceling you before the expiration date of your policy, they wait for the policy to expire and refuse to renew the policy. Non-renewal can also happen for various reasons. In Massachusetts, thousands of homeowners learned that lesson when their homeowners policies were not renewed because of their proximity to water. Or, an auto policy allows you or a family member to accumulate “points” on your auto insurance policy as a result of accidents, speeding tickets, or a DUI. If you have accumulated too many points, your insurance company may decide not to renew you. They would place you in an alternative market that could cost you hundreds of dollars in additional premium.
There are other situations in which you can look for another insurer. Did you know that many insurance companies would refuse to write your business if you own a certain breed of dog? Most insurance companies have a list of dogs — German Shepherds, Doberman pincers, Rottweilers, and Pitbulls to name a few that prevent you from buying homeowners insurance through that company. You may be denied coverage if you have a lot of claims, a bad insurance score, or even if you own a trampoline. Insurance companies are very picky about who they insure. A bad credit score can indicate a lack of responsibility and carriers do not want to take unnecessary risks. Dog bites or injured children on trampolines can significantly escalate claims, which is why insurance companies refuse to write such risks.
Each insurance company has its own guidelines and terms and conditions, so it is important to be honest with your insurance professional to ensure both good coverage and avoid cancellations and/or non-renewal.
The bottom line is that you have the right to choose your carrier and they have the right to choose you. Sometimes you can’t control situations, such as a courier’s change of heart when writing houses near the ocean. But if you are a responsible person, insurance companies will compete hard for your business.
Can my insurance company cancel my homeowner’s or car’s policy?
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