What you need to know if you’ve been denied homeowners insurance
For those who have been denied homeowners insurance coverage, here are some common factors that may help explain why this might have happened, as well as some steps you can take to secure and maintain homeowners insurance to help protect your property.
- Previous claims: In general, the more claims you have, the higher your perceived risk is to insurers. Insurance companies also consider the type of claim(s) that you have had in the past. While the amount and types of previous claims lead to higher premiums for current policyholders, it can also risk your ability to renew your policy or get a new policy approved. Many insurance companies may not issue a new homeowners insurance policy, if you have filed a claim within the past three years. After this period, you may become eligible again, and the insurance company may be willing to re-quote you. However, no two homeowners or insurance providers are alike. Be sure to check with your insurance agent if you think previous claims may impact your chance of obtaining new coverage.
- Location: Where you live may determine whether you qualify for homeowners insurance. Some areas are considered “high risk” by insurance companies. Insurance companies will not provide insurance in some areas, may limit coverage, or may have stopped covering homeowners in certain states. For example, regions in California that insurance companies may not cover, due to the risk of wildfires. If you live near an area with high brushfire risk, you may be able to reduce this risk by cutting away nearby brush. An insurance agent can be a useful resource for discussing ways to reduce the risk of damage to your property and thereby increase the likelihood of becoming approved for homeowners insurance.
- Materials: As your home and roof age, they could become more susceptible to damage from weather elements or even internal deterioration. Replacement costs, including material and labor, go up over time. It’s very important to keep your home in good repair by addressing any issues -- such as a deteriorating roof, missing shingles, damaged or missing railings, or peeling paint -- as soon as possible, so these do not affect your ability to get coverage.
- Credit history: Your credit score may impact your ability to get homeowners insurance; however, it is usually not the only factor. To address this factor, consider taking steps to rebuild and improve your credit.
- Type of pet: Dog owners may not be able to obtain homeowners insurance if their pet’s breed is considered aggressive or has a bite history. Dog bites account for a third of all homeowners liability claims. You might want to do some research before choosing the breed of your next pet.
There are many other factors that might affect your ability to obtain homeowners insurance. Some examples are: mold contamination from previous water damage; older homes with outdated systems (such as an electrical panel with fuses rather than circuit breakers, or mechanical systems); overhanging trees that are touching your home on the property; having an above ground or in ground pool that is not fenced; or even having a trampoline without netting walls. If any of these factors affect you, look into ways to address them immediately.
For more guidance about steps you can take, consider speaking with an insurance agent for more information. If you do not have one, Wells Fargo Insurance agents can help provide more information about homeowners insurance coverage or state ‘fair plans’.
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Insurance Information Institute, “Wildfires Pose Threats to Many Parts of the Country, Not Just California,” 2009.
Federal Trade Commission, “How Credit Scores Affect the Price of Credit and Insurance,” 2013.
Centers for Disease Control and Prevention, “Home & Recreation: Dog Bites,” 2014.
Please review your insurance policies carefully, as coverage and exclusions vary.
Wells Fargo Insurance, Inc. (Minneapolis, MN) is a licensed agency that represents — and is compensated by — the insurer based on the amount of insurance sold. No purchase of an insurance product through Wells Fargo is required.