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What to Do If Your Home Insurance Policy Is Not Renewed

In recent times, major property insurance companies like Allstate and State Farm have stopped issuing new home insurance policies in California. Similarly, Farmers Insurance has limited its homeowner policies in Florida and California. These changes are largely due to financial losses from claims related to natural disasters such as wildfires, floods, and hurricanes. As a result, homeowners across the country are finding it increasingly difficult to secure or maintain home insurance coverage. If you find yourself in this situation, here are some steps you can take.

1. Contact Your Insurance Company

If your insurer decides not to renew your policy or cancels it, the first step is to reach out to them. Nonrenewal typically occurs when your policy is about to expire, while cancellation can happen at any time. Insurers usually notify you 30 to 60 days before your coverage ends. Ask why your policy is not being renewed. If it’s due to living in a high-risk area, inquire about steps you can take to keep your policy, such as making your home more disaster-resistant.

2. Shop for New Insurance

If your current insurer won’t renew your policy, it’s time to look for new coverage. Start by contacting your state’s insurance regulator for a list of insurers still operating in your area. Compare quotes from at least three different companies to find the best rates and coverage. Remember, the cheapest option isn’t always the best. Consider the types of coverage, available discounts, deductibles, and the insurer’s reputation. Also, ensure that the new policy meets your mortgage company’s requirements.

3. Look Into Government Plans

Every state offers a FAIR (Fair Access to Insurance Requirements) plan as a last resort for securing home insurance. These plans are generally more expensive and offer limited coverage compared to traditional policies. Coverage varies by state but usually includes dwelling coverage, with optional coverage for personal belongings and other structures. However, personal liability and loss-of-use coverage are typically not available under FAIR plans.

The Bottom Line

It can be frustrating if your home insurer doesn’t renew your policy or if insurers stop offering coverage in your state. However, you have options. A different insurance company or a FAIR plan may provide the coverage you need. Additionally, maintaining a good credit score can help you secure better rates, as insurers often use credit-based insurance scores to determine premiums. Regularly check your credit score and report, and make necessary adjustments to improve your score.

For any mortgage-related needs, feel free to contact O1ne Mortgage at 213-732-3074. We’re here to help you navigate your options and find the best solutions for your home insurance and mortgage needs.

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