Many people don’t realize that they could actually save themselves a lot of hassle and money in the long term if they ensure that they do not have gaps in their home, condo, or tenant insurance. Why is that, you ask?
Let us explain!
When you buy home insurance, the insurance company pays a small fee (the premium) and agrees to help reduce your financial worry and make accidental loss more manageable should you have a claim.
An insurance company will have many clients paying them premiums, and they will use the premiums accrued to pay some losses. If an individual is dipping in and out of that ‘pot’ of accrued premium, it’s not fair to everyone that pays in regularly, and it doesn’t make good business sense.
Insurance companies also know from their records that statistically, there is a correlation between bad risks and gaps in coverage – and by bad risks, we mean risks where the individual wanting insurance may not have been entirely truthful about their home or that they have a terrible claims history which they did not declare.
So often, traditional insurance markets will decline to quote individuals who have had long gaps in their home insurance unless there is a good reason.
It’s essential that before you lapse your insurance, you speak with your broker to see if there is an inexpensive option available to keep your insurance continuous.
What if I already let my insurance lapse?
If you have not had continuous insurance coverage on your home, specialist insurance markets out there will insure your home when there has been a long gap in coverage. The premium will generally be slightly higher than usual for the first 2-3 years. Still, once you have some no-claims insurance history behind you, you may then be able to return to the traditional insurance markets.
Call us today at 1.844.544.4663 to speak with one of our qualified brokers about more information on this topic.