Can an insurance company cancel my policy, because of claims?

Question

My had some water damage and mold the insurance company paid but, now they are cancelling me because of it, I been with them for ove 25 years without a claim until now.

Answer 1

A few states won't allow an insurance company to cancel for claims, but most do. I'm guessing, your state allows it.

Long time loyalty counts for NOTHING. As you've found out. Worse, with a water claim, and a PAID MOLD CLAIM, I don't know ANYONE who's going to insure you. You'll likely end up with the state FAIR plan - higher rates, MUCH less coverage than a standard homeowners policy.

Start shopping now. I hope you prove me wrong.

Answer 2

Yes they can do that. It discourages frivolous claims. Most policies state either a number of claims or dollar amount that can lead to being dropped or change in coverage amounts. My parent's filed a claim for water damage due to a faulty water heater and it was the third claim in 5 years (one was a outbuilding that was damaged in a storm can't recall the other) and they got a letter saying instead of a $250 deductible, they have a 10% ded now. After 35+ years of coverage with this company. Needless to say they are ticked but it is within the companies rights to do so.

Answer 3

Just to clarify something here - there is a big difference - are they canceling your policy or non-renewing it?

There's nothing that can be done about non-renewal. If an insurance company doesn't want to insure you anymore, they don't have to but.

But, cancellation; that's different. If they are truly canceling the policy, grab your policy and read your cancellation clause. Normally policies can only be canceled for a few very rigid reasons; and claim payments is generally not one of them.

Answer 4

You said the magic word "mold".

Once the asbestos and cigarette law suit wells started going dry - plaintiffs lawyers jumped on the Mold band wagon and started suing, Since it's highly litigious, Mold is one thing that insurance companies will not touch. It's not that they don't appreciate you and your long term service - it's the "M" word.

Depending on what caused your loss and the likely hood of it happening again the insurance companies are going to be wary.

Talk to your agent. See if they are able to talk to the underwriter about your situation. It may not help but it can't hurt.

Also- if you have taken steps to correct the problem so it won't happen again - let your agent know. It may make a difference.

Answer 5

Many companies have specific exclusions about (not) covering mold damages, and many companies refuse to provide policies to houses with a mold claim or mold history. Since it's in the original contract, it's legal, and like everyone else said, loyalty means nothing.

Answer 6

Sure they can. It's very common, and the length of time you have insured with them means nothing to them. An insurance policy is an annual contract between you and the insurer, and the insurer has the option to not renew you for whatever reason they choose, as long as it does not involve discrimination or other illegal reasons.

Answer 7

depends on the state .. if the state you lives in allows it than the insurance company can cancel you for claims.

Answer 8

Well insurance companies are just bastards like that. Who needs 'em ? Just make sure that if you can milk any more money out of the policy, you do it. Now, trash em online (great start here!) Complain to everyone you know about them, including the Better Business Bureau. Say how horribly they are treating you. What is the company name, BTW? Companies / corporations blow. Don't worry, some other place will insure you.

Good luck!

Answer 9

Sad to say, but they can...... that's when people should take the time and write they're congressmen, senators and such...otherwise nothing will ever be done about Insurance carriers coming in and making all their money, and then getting out when the have to pay...

Answer 10

Yes, and They can cancel because you have no claims for 25 years and your due for one.