Owning a home means that you have invested a large portion of your income into your home. If a catastrophe occurs, you will lose everything if you don’t have homeowners insurance. Most people buy homeowners insurance without any hindrance, but there are certain situations in which you may be denied coverage.
Why Were You Denied Home Insurance?
Several factors determine your eligibility for homeowners coverage. If your home is old and has modest damage, you may be denied coverage because your risk of a claim is higher. Other reasons why you can be denied coverage are that you have a poor credit score or have filed multiple claims in the past few years. Your insurance provider will always try to gauge your potential risk level when determining eligibility, and if it’s too high, you won’t get coverage.
In some cases, especially when it comes to low credit scores or frequent claims, the problem may be more with you than your home. Avoid filing claims on small amounts. This will flag you as high risk and possibly lead to denial of coverage or future revocation.
What to Do Next?
If you’ve been denied home insurance, find out what led to the denial. Make the necessary improvements and try to raise your credit score. Look for a high-risk policy so that you at least have some coverage against catastrophic events. While your high-risk policy is in place, make as many improvements as possible. Install a security system and make the required repairs to your house. While this may not solve the problem right away, you will eventually be back on track and reduce your risk exposure if you keep working at it.
You can consider getting high-risk homeowners insurance, which will cost more but is worth your peace of mind. It’s important to find out why you were denied so you can work towards rectifying the problems. Until then, you will have a high-risk policy to fall back on.
Make sure to let your insurance agent know each time an improvement is made. This will show responsibility on your part and help lower your potential risk, making it easier for them to insure you. If your problem is your credit score, that won’t change overnight. Nonetheless, you can work towards improving it over time.
If you have recently been denied homeowners insurance, you still have options. Contact our agents at Burton A. Harris Insurance Agency. We will help you find customized home insurance according to your budget and needs.