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 takes a payment in the form of 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 the losses of some. 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 completely truthful about their home or that they have a bad claims history which they did not declare.
So often, regular insurance markets will decline to quote individuals who have had long gaps in their home insurance unless there is good reason.
It’s important 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, there are specialists insurance markets out there that will insure your homes when there has been a log gap in coverage. The premium will generally be a little higher than usual for the first 2-3 years, but once you have some no claims insurance history behind you, you may then be able to return to the regular insurance markets.
Call us today to speak with one of our qualified brokers about more information on this topic.