Denied Homeowners Insurance

Insurance companies can be very strict about who and what types of properties they choose to insure. This is understandable as insurance companies must protect themselves from high risk situations, but as a potential homeowner it can be very frustrating. Knowing what the insurance company is willing to cover ahead of time will save you a lot of time and frustration.

Personal and credit history - When you apply for insurance, some insurance companies run a credit check and you could be denied based on a low score. Underwriting will also pull your claim history called a CLUE or A+ report. Depending on the types of claims you’ve made in the past, you could be denied. It is important FOR homeowners to understand that homeowners insurance should only be used for larger losses and not small or maintenance issues as it could affect your future requests for insurance.

Condition of property - When you apply for insurance, the insurance agent OR INSPECTOR will most likely go to the property to verify the condition of the home. If it appears to be a high-risk property, you could be denied coverage. Very old homes that are in poor condition could be viewed as high-risk as they have older components to them and have the potential for more claims than a newer home.

Location of property - Much like the condition of the home, the location of the home is very important. Homes located in a natural flood plain or next to a body of water could be denied coverage. Crime rates are also SOMETIMES considered in the ELIGIBILITY FOR COVERAGE. Moving into an area where crime is higher can affect your insurance eligibility and cost. Being proactive and having an alarm or storm doors and windows can help you in getting insurance on homes in these situations.