Life can be filled with challenges: death, job loss, marriage dissolution, etc. When such circumstances add up, thing can get complicated financially, and sometimes overwhelmingly so. Filing for bankruptcy is a difficult decision to make, but it’s sometimes inevitable despite its consequences on your life. Of course, your insurance coverage is bound to be impacted by this decision. If you are currently in this situation, be assured that Assurances Multi-Risques brokers are not there to judge you, but rather to help you to get the facts on what is likely to happen insurance-wise, and to offer you the tools that you will need to get insurance coverage after having filed for bankruptcy.


Why do insurers refuse to insure people who have filed for bankruptcy?

A refusal to grant insurance coverage to people who have filed for bankruptcy stems from various factors. These can seem unjust or even discriminatory, but as insurance brokers, we are here to help you to understand why such practises are in place.

Insurance companies set their acceptance criteria according to risk and previous experience. You might have guessed it, for insurance companies, people who have filed for bankruptcy are likely to represent an increased liability. Indeed, a bankrupt person’s capacity to invest into preventative measures to protect his or her car and residence will be less than a person’s whose financial situation is sound. The bankrupt client is therefore more likely to file an insurance claim than other clients in case of problems! On this subject, we invite you to have a look at one of our previous articles that explains why car and home insurers check your credit score before agreeing, or not, to insure you.

The client’s debt and credit score are the elements that allow the insurer to calculate his level of risk. That’s why insurers are unlikely to insure people who have filed for bankruptcy even if they have never filed an insurance claim in the past. Acceptance criteria are based on statistics, not individual history, and unfortunately these numbers don’t favor clients who have filed for bankruptcy.


How can you get insurance coverage following bankruptcy?

First of all, we recommend that you inform your insurer if you are planning to file for bankruptcy or if you have done so. By doing this, you will avoid future problems with your insurer or have him refuse a claim. Being transparent is always our number one tip when it comes to insurance coverage! Please tell your insurer the truth. This may cost you money in the short term, but having been truthful will always pay off in the long term. If you have difficulty finding an insurer because of your financial situation, we recommend that you contact an independent insurance broker specializing in clients like you.

We also advise you to avoid high interest car loans as they will be detrimental both for your car insurance and for your financial wellbeing. To find out more about this, please have a look at our previous articles on second chance at credit.


By way of conclusion, Assurances Multi-Risques is conscious of the difficulties associated with bankruptcy and the fact that you have to start from nothing all over again, including insurance-wise. It’s impossible to change the past, but you can take hold of your future. Learn from this painful experience and make it a growing experience. Don’t be afraid to talk to professionals, like an independent insurance broker, who will help you to emerge from this difficult situation and to experience blue skies again.