732.747.0041
Insurance Advisor at Oliver L.E. Soden Agency, Inc

Can My Insurance Company Drop Me?

Your mortgage lender requires proof of insurance on your home, so keeping your policy is vital. It is possible that your insurance company can drop you if you file more than one claim in a certain time period. Each state is different, so it pays to work with a local agent who understands the rules and regulations in your state. In New Jersey, your insurer is free to not renew your policy for any reason. However, they must provide you with a formal, written notice and a reason 30 days prior to your policy expiring.

 

To avoid having your policy dropped, the best steps you can take are to pay small claims, maintain a good credit score and keep your home in good condition. If you receive notices or letters from your insurance company, respond in a timely manner. Like any business, insurance companies want to keep their best clients.

 

When Should You File a Claim?

 

You have homeowners insurance. You pay your premium every month. So why can’t you use your insurance freely?

 

While you may feel that you have the right to file claims as you wish, insurance companies prefer to keep the clients that are the lowest risk. In order to avoid paying out continuously for claims of all sizes, there are laws to protect insurance companies, such as their ability to not renew your policy. To avoid this from happening to you, be smart about when and when not to file a claim.

 

Here are some tips to help you get the most from your insurance.

 

  • Talk to your agent. Your agent is available to help you. Talk to them before filing a claim. Find out what the best route of action is, and how you can get your home fixed by putting out as few dollars as possible.

 

 

  • Mitigate damage. It is your responsibility to prevent damage to your home. Be responsible by taking care of your home and limiting the risk of accidents, water damage, etc.

 

  • Pay small damage claims. As long as the cost to repair your home is less or around the same as your deductible, pay for the damages out of pocket. This keeps you in good standing with your insurance company.

 

If your insurance company does drop you, it’s not going to be easy to find coverage with another company. Some won’t quote you if you’ve had two or three claims in the last few years. Be proactive by understanding your policy, keeping your home in good condition and not filing small claims. If you do receive a letter from your insurance company not wanting to renew your policy, reach out and ask them to reconsider.