Before agreeing to cover a person’s residence, insurance companies conduct a number of checks: the age and dimensions of the house, building materials, rebuilding cost, heating system, location, etc. They also check your credit report, your past accidents and whether you have a criminal record.
When faced with everything that is taken into consideration when it comes to home insurance, or even property and casualty insurance in general, it’s normal to feel a little overwhelmed and not know how to manage it all in order to avoid insurance problems!
In this article, Assurances Multi-Risques has decided to provide you with a guide to being a good policyholder! Note that this advice is valid regardless of whether you are with a standard or non-standard insurance company.
Second-chance home insurance: what are the circumstances?
Various circumstances can lead to a “second-chance” situation for your home insurance. When you do not meet the standard home insurance criteria, it is also referred to as “non-standard” home insurance.
You must know that an insurer can cancel an insurance contract at any time, but under certain conditions. Usually, the insurer can only cancel the contract when it expires. In other words, they can choose not to renew your insurance. However, the law allows insurers to cancel a contract at any time as a result of increased risk or the policyholder’s failure to pay their premiums. This type of situation leaves a significant mark on your file and makes it difficult to find insurance!
Here is a very simple, informative list of various reasons why you may find yourself in a second-chance situation:
- Having a criminal record;
- Cancellation due to non-payment;
- Insurance denied;
- Accident rate that is too high;
- A bad credit report or none at all;
- Having an unconventional creditor or landlord;
- A building (residential or commercial) with significant physical weaknesses;
- A vacant building.
Now, avoiding these situations is up to you!
It’s sometimes easier said than done, but here are some tips to help you stay out of trouble!
- We strongly advise against making false statements when you contract or renew your insurance. Always be honest!
- Avoid insurance interruptions. If your home insurer cancels your contract, immediately contact a broker so they can quickly find you a new insurance company. If you experience an insurance interruption, your premium will definitely cost you more;
- If you have an unpaid balance with your previous insurance company, pay it to avoid having a collections agency coming after you, which will worsen your credit report;
- Closely monitor your pre-authorized payments and make sure you have funds available for your monthly insurance payment. If you are in a difficult financial situation, don’t hesitate to contact your insurance broker so you can quickly come to an agreement with your insurance company.
- Avoid serious mistakes! You know, the ones that can leave you with a criminal record.
If you have problems getting insured, know that there are always solutions!
By choosing to work with an independent insurance brokerage specializing in second-chance home insurance, for example, you can quickly find an insurance company willing to cover you.
With our good advice, you can also improve your record (as long as you put in the effort too!) and return to the standard market. All is not lost—at AMR, we believe in second chances!