By: Rodney A. Cook. November 2, 2023
“Understanding How Insurance Companies Decide to Insure Your Home”
Introduction: Welcome to The King of Coverage’s Royal FAQ Corner, where we demystify the world of insurance! In this blog post, we’ll explore how insurance companies decide which homes to insure. Whether you’re new to the world of insurance or just curious about the process, you’re in the right place. Let’s dive in and learn together!
Why Are Insurance Companies Growing in Home Insurance? Insurance companies have been expanding their offerings when it comes to home insurance, such as Dwelling Fire Basic & Special and Homeowners insurance. But why the sudden growth? Well, it’s all about economic factors that are causing insurance companies to be more selective in the homes they insure. Let’s break it down.
Ensuring a Healthy Insurance Portfolio: Insurance companies want to make sure their insurance portfolio remains strong and sustainable. To achieve this, they’re making changes to ensure they only provide insurance for homes that meet their specific rules and safety standards. This helps them maintain a balanced and reliable portfolio.
What’s Different Now? So, what’s changed in the way insurance companies decide to insure homes? If a house doesn’t meet the insurance company’s criteria, they may decline coverage. The Underwriting Department and some sales partners have the authority to say no to your insurance request. But don’t worry; they’ll always explain why they had to decline your request.
Factors That Concern Insurance Companies: Insurance companies are particularly concerned about certain factors when considering whether to insure a home. These factors include:
- Damage or needed repairs in the house.
- Saggy porches or roofs.
- Poor condition of the roof.
- Lack of proper maintenance by homeowners.
Additionally, they keep an eye out for potential safety hazards, such as broken steps and handrails, heating, wiring, plumbing issues, and more. Their main goal is to thoroughly assess the risk associated with insuring a particular home.
A Bit of Patience Pays Off: Keep in mind that this careful assessment process might lead to a slight delay in getting your insurance policy. But as the saying goes, “Good things come to those who wait.” This scrutiny ensures that you receive the right coverage for your home.
What If Your Home Doesn’t Pass the First Check? If your home doesn’t meet the initial criteria set by the insurance company, they may ask for more information. This could include pictures or documents showing your plans to address any issues before they make a final decision.
Consider the Price: If the cost of insurance for your home is too high, insurance companies might propose alternatives like increased deductibles, ACV settlement, or exclusions. It’s all about finding the right balance between coverage and affordability.
In Conclusion: In a nutshell, insurance companies are taking extra care to ensure they provide coverage to the right homes. While it may require some additional effort and patience at the beginning, the goal is to protect homeowners and maintain a strong insurance portfolio. Thanks for joining us at The King of Coverage’s Royal FAQ Corner! Stay safe, stay informed, and make sure you’re properly