Speaking from personal experience, getting a letter from your property insurer saying ‘Notice of Non-Renewal’ – a tamer way of saying the policy will be canceled after the end of the current 12-month period – can be a little nerve-wracking, especially during of hurricane season or if your mortgage company requires year-round coverage.
So what should you do first?
“Don’t panic!” said Jayden McCart, manager of the 35-year-old family-owned McCart Insurance Agency in Palm Bay, just north of Vero Beach. “Call your local agent and talk to them.
Usually if the home is well maintained they will issue a replacement policy but it depends on what they want. If it’s for a specific thing, like a roof, plumbing or electricity, it can be fixed before the (current) policy expires.
“And in some cases companies have stopped writing policies or reduced hurricane policies, so in that case you’ll have to look around.”
The thought of playing classic jump through the maze of insurance companies, four-point inspections (including electrical and plumbing) and wind mitigation analysis can be intimidating.
Going to an insurance broker may not necessarily be the way to go, McCart said.
“We’re (listed as) an Allstate company, but people think we’re just selling Allstate. We work with many other A-rated companies to get you the best (deal) for your situation,” he said.
National Citizens’ Property Insurance is also an option, although its policies must be 20% or more cheaper than your current policy. Citizens require a four-point inspection for all homes over 20 years old.
A report by The Balance, a national website that prides itself on experts providing clear and practical personal finance advice, notes that a canceled policy can mean a property owner may struggle to find a new carrier or settle with one that is much higher more expensive.
Many Florida homeowners received non-renewal notices just before July 1 of this year, before new state legislation (signed by Gov. Ron DeSantis in late May) went into effect that could lower rates for customers over the next 12 to 18 months, some politicians said.
The new legislation prohibits insurers from automatically denying cover if a roof is less than 15 years old. Homeowners with roofs 15 years or older will be eligible to get an inspection before insurers deny them coverage. If an inspection shows the roof has at least five years of life left, insurers cannot refuse to issue a policy based solely on the roof’s age, under the proposed legislation.
If a roof is more than 25 percent damaged but already meets the state’s 2007 building code, it would only have to be repaired by insurance companies instead of completely replaced, under a building code exception the proposed legislation creates.
According to The Balance, the best way to defend your case to your insurance carrier is to offer concrete evidence that things have changed. If things haven’t changed, consider improving the situation, such as installing an alarm system if, say, your house has been burglarized twice. Or offer a higher deductible to show you’re willing to take on additional risk and responsibility, the report said.
Every insurer is different, McCarth said, and every case is different.
But, according to The Balance, the ratio of how much the insurance company paid out on your claims versus how much they were able to collect in premiums from you will ultimately come into play.
McCarth’s final tip? Make sure you are insured for at least the basics, such as fire and liability.
“I always recommend having coverage over not having it,” he said.