Know Your Options if Finding Insurance is Hard to Do

Not everyone can just expect insurance will fall into their laps without any hiccups along the way.

If you reside in a residence that is looked upon as “high-risk” or plan to relocate to a high-risk area, you could have a tough time acquiring an insurance policy.

So what are some of the factors that constitute risk?

Among the issues will be: Your home is situated in an area prone to severe weather like hurricanes, tornadoes or windstorms; you reside in an urban area with high crime, vandalism or theft; your residence has an old plumbing, electrical and/or heating system that leads to a higher possibility of causing fire or water damage.

In the event an individual gets turned down, it is important they don’t give up, as there are other options.

If you are purchasing a new home, check with the real estate agent, mortgage lender or builder for individuals or businesses writing in your locale.

In case it’s an existing residence, question the prior owners who insured the home. If still unable to locate coverage, think about the following: Talk to the agent or company rep that previously insured your home or is presently insuring your vehicle or business. If the issue is not where home is located, but the condition that it is in, discover what kind of improvements or disaster-resistant features are necessary to make the home more insurable.

Individuals should also talk to neighbors and determine which insurance companies they use. The idea here is to secure the names of any agents who may be knowledgeable regarding the specific risks in your neighborhood.

Individuals will also want to call their state insurance department, as it can usually offer consumers a list of insurance companies that write in their area. One’s respective state insurance department may also contain information regarding community groups that assist homeowners with insurance issues.

For those consumers who still find it hard to secure coverage, find out if your state has a special insurance plan known as shared market.

In many cases, a pair of plans exists:

Fair Access to Insurance Requirements (FAIR) Plans was formed in the 1960s to make insurance available in areas possessing abnormally large exposure to risks over which they had no control. These plans are insurance pools that sell property insurance to individuals who are unable to obtain coverage in the voluntary market.

While FAIR Plan policies may be more expensive than private insurance and might offer less coverage, they offer insurance protection that would otherwise not exist. All FAIR Plans provide coverage for losses resulting from things such as fire, windstorm and vandalism.

As it turns out, around a dozen states have some means of a standard homeowners’ policy, including liability.

For individuals looking to qualify for FAIR Plan coverage, they must make improvements that limit the chance of fire, water damage or theft. Means to do this include upgrading security, electrical wiring, heating and plumbing systems.

Consumers also need to note that if they do not fix conditions that make their homes prone to losses, the FAIR Plan administration has the right to say no to insurance coverage.