Getting Dropped By Your Insurance Company? See What to Do

Getting Dropped By Your Insurance Company

Nobody likes being broken up with. I can still remember being broken up with by my high school sweetheart when when I was 16, lol. We had both grown apart but even with all of the changes we faced, it still broke my heart when she ended our two year relationship immediately we graduated.

Now liken being dumped to being “dropped” by your insurance provider. When it happens to you, it hurts. You may have thought things were going well because you always paid on time but then out of the blue they send a registered letter saying that its over, they won’t be renewing your policy.

What happened? How did things come to this?

it’s not a question of how many accidents can you have before your insurance drops you? or How Many Claims Can You File Before Your Car Insurance Cancels You? since Getting into an automobile accident can be a nerve rattler, to say the least.

It has been my experience the insurance industry has a real problem explaining why they decide to drop certain drivers. When an insurance company decides not to renew a policy its because someone on the policy no longer meets the “acceptability threshold”.

An “acceptability threshold”, means an insurance provider can only insure people with a certain driving history. Every time you get a speeding ticket, cause an accident or miss payments you earn “points”. Once a certain amount of points are collected, the insurance is FORCED to drop you.

Why?

Simply put, because you’ll screw things up for the good drivers that don’t break the rules. Insurance companies have ENORMOUS amounts of data that have been collected over the decades. They know that your driving history is the best indicator of future habits and future claims.

If you have been charged with speeding several times, you are more like to cause an accident.If you are more likely to cause an accident, you are more likely to injure or kill somebody, which then costs insurance providers million’s of dollars. When enough clients have these types of claims they raise their insurance rates, which affects all of the drivers who don’t speed in the first place. Then the good drivers find a new insurance provider because they feel like they are paying too much.

What Will I Do Now That My Insurance Company Dropped Me?

Being dropped by an insurance company is not the end of the world and it should not being taken personal. The first thing you need to do is start calling a different insurance brokers to find a new provider. To save time, avoid calling companies like Allstate, State or Co-operators. These insurance providers typically deal with the regular market and avoid insuring high risk drivers.
Once you are considered a high risk driver you can expect to see your premiums double or even triple. What I usually suggest to clients is that they consider how important is it that they have a vehicle. It can take as many as six years for the driving records of high risk drivers to completely clear.

Instead of paying high insurance premiums, high risk drivers could pay down debt or take several really nice vacations.

Ways to Avoid Being Dropped By Insurance Company.

There are several things that you can do to maintain a “low risk” policy holder status and reduce the chances of your insurance coverage being canceled or not renewed:

    •  Pay on Time.

    Don’t get behind in your premium payments.

  • Drive Safely.

This one is obvious. you have been told countless times not to drink and drive. Follow the traffic laws. If you drive safely, you are much less likely to get into an accident or receive a ticket.

  • Don’t Lie.

Make sure to always be truthful in your dealings with your insurance company, also, don’t file a fraudulent insurance claim.

  • Don’t Make a Claim.

If you were involved  in a small accident or incurred some other minor damages to your car, you might want to consider paying for the repair out-of-pocket and leaving your insurer out of it alone. I know that this can be rather frustrating if you look at the bills. I mean, isn’t that why you have insurance? But the bottom line is that paying for the repair yourself may keep you from being dropped or, at the very least, having your premium increased.

Let me know what you think in the comment section.

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