Frances Badayos | author
ICHQ | Site Author
Navigating the world of homeowners insurance claims when an insurer has dropped you can seem overwhelming, but there are resources available that can help make the process easier and get you back on track with protecting your home as quickly as possible. It’s an unfortunate situation to be in, but it is important that you understand the law and your rights as an insured. Knowing your rights will help you protect yourself from having to pay out of pocket for any unexpected incidents or accidents.
Louisiana Law on Homeowners Insurance Cancellations
Under Louisiana state law, homeowners’ insurance companies must notify their customers of cancellation or non-renewal at least 30 days before insurance coverage officially ends. This notification should include valid reasons why they are canceling or not renewing a policy, as well as an explanation of any rate increases that may occur due to these changes.
Reasons homeowners insurance companies might cancel policies
Homeowners’ insurance companies can terminate a policy for various reasons, such as:
- Nonpayment of premiums;
- Material misrepresentation;
- Significant changes in risk coverage; and/or
- Violation of policy terms and conditions.
It’s important to note that insurers cannot discriminate against customers based on race, color, religion, sex, national origin, age, marital status, sexual orientation, or disability. Additionally, it is important for policyholders to understand that they cannot be denied renewal solely because of increased risk due to age or health conditions.
However, insurers are legally allowed to cancel coverage for other reasons that may be out of the policyholder’s control, such as an increase in natural disasters or weather conditions in the policyholder’s location that the insurer believes represents an untenable risk.
If the policyholder and insurer are not able to negotiate an increased premium to satisfy the insurer’s evaluation of the risk involved, then the insurer may terminate the contract.
Homeowners Insurance Canceled? What You Can Do Next
The first step is to look at your policy documents. Review each document carefully and ensure the termination complies with all terms of your contract. Check the reasons stated in the letter of cancellation and see if they conform with what is stated in the policy documents. If not, you may have a legal claim against the insurer for wrongful termination of coverage.
Additionally, find out when the policy was written, as some older policies may place restrictions on how often insurers can cancel or non-renew a policy. Under those conditions, insurers must provide written notification before any cancellation takes effect.
Once you’ve done that, then you can take further action, including:
- Contact the insurer immediately and ask for details about why your policy was canceled or not renewed;
- Request an explanation from the insurer if you do not understand why your policy was canceled or not renewed;
- Request a copy of your credit report from all three credit bureaus (Equifax®, Experian®, TransUnion®) and ensure it’s correct;
- Review your state’s consumer protection laws regarding cancellations and non-renewals; and
- Shop around for other homeowner’s insurance companies who may offer competitive rates and better coverage options than your previous provider.
Ensure that your legal rights are upheld
It’s important to be informed about what steps need to be taken if something goes wrong along the way in regard to cancellations or non-renewal by your insurer. It’s important that you know your rights and that insurance companies are held accountable if they step out and line.
Although there are valid and legal reasons that an insurer might terminate a relationship with a policyholder, the homeowners insurance attorneys at Insurance Claim HQ can evaluate your situation and determine if your insurance provider has illegally terminated your coverage. Reach out today for a consultation to ensure your legal rights are upheld.
Homeowners Insurance FAQs
Is there a difference between non-renewal and cancellation?
Yes, in that a non-renewal means that your coverage is terminated at the end of the term, and a cancellation means it is ended during the term. However, your rights as a policyholder do not change between the two actions.
Can my insurance provider drop me just for filing a claim?
Although your provider is allowed to terminate coverage for a comprehensive history of claims that they cannot justify at a given premium rate, they cannot terminate your coverage in retaliation for filing a claim. An experienced attorney can help discern if this has occurred.