Insurers changing conditions almost immediately after signing?

[SusieQQQ 11,586]

So, to cut a long story short, we signed a contract for homeowners insurance (through a very well known insurance co) a couple of months ago, and paid the agreed premium. Literally a month later we got a notice of cancellation if we don't add in a bunch of things (like automatic fire alarm, despite we have a sprinkler system, and a few other things) - none of which were mentioned on the original contract as conditions. And at the moment they are not even prepared to guarantee taking us off cancellation notice if we do all these things! What the heck is going on?? Is this normal? How do we know the next company we sign won't do this?

[Golden Gate 530]

Is it State Farm? They did the same thing to us, although it was about the roof. Apparently when you are just buying a home, the insurance company and everyone are just rushing to close on the home, so they don't look carefully at all the details, but later they do. They kept coming around and taking pictures of our roof, though we fixed parts of it, and had to fix some other things outdoors for them. Eventually they still weren't happy and cancelled our insurance. We switched to Farmers. We couldn't afford to replace our roof the first year, but we ended up doing it this summer. State Farm told us to call back once we replaced our roof, and we'd get a discount, but I don't want to deal with their hassling us every month, canceling us over and over.

[SusieQQQ 11,586]

No, it's not State Farm... but I guess we will give anything from them a sceptical eye too.

but what the heck is this, surely if the contract is specified up front they can't just unilaterally threaten to cancel it because they come up with something, at least until it's time to renew or you have withheld a material fact..

Also none of the stuff is 'house specific' like fixing a roof. It's general stuff like a fire alarm system...

Edited October 1, 2015 by SusieQQQ

[Golden Gate 530]

Apparently they can do that. We also had a problem because the bank didn't ask us to pay enough for the escrow when we signed, so some months later our monthly house payments also went up more than $100.

Yes, State Farm is really tough. They are highly restrictive.

Edited October 1, 2015 by Golden Gate

[Golden Gate 530]

Roof leaking, fire spreading... I am not sure why they need you to have an automatic fire alarm system, but that seems pretty specific to me. Don't you have fire alarms throughout the house? San Francisco, if that is where you are, of course has different building requirements especially because of earthquakes, but that does seem excessive. I recall when I lived in SF, there were always just fire alarms throughout the houses. Anyway, different insurance companies have different thresholds and I guess since they are the ones who are insuring you they have the freedom to decide whether they want to or not. Never liked insurance companies!

Edited October 1, 2015 by Golden Gate

[SusieQQQ 11,586]

We have a sprinkler system, but in any case our house is not more or less fire-threatened than anyone else in town, this is something they would/should have known before the contract was signed. It wasn't something 'new' a physical inspection would have brought up.

And I'm not contesting their right to specify conditions, what I am doing is questioning retroactively imposing conditions on a signed, agreed contract on which the premium has already been paid...

[Golden Gate 530]

Yeah, I agree. If they cancel it, they should refund your premium. They did us.

[Golden Gate 530]

I found this on the web:

"Cancellation of your homeowner’s insurance coverage by your insurer is allowed within the first sixty days from the time the policy is issued in a case that undisclosed risk of loss is discovered which is not related to a prior claim, fraud or increased risk are discovered or you have not paid your premium. Such cancellation requires the insurer to give you thirty days’ notice. - See more at: http://www.surfrate.com/homeowners-insurance-guide/what-to-do-if-your-homeowners-insurance-is-cancelled."

http://www.surfrate.com/homeowners-insurance-guide/what-to-do-if-your-homeowners-insurance-is-cancelled.html

[SusieQQQ 11,586]

Doesn't sound like any of that actually applies to us but tbh I can't be bothered fighting to stay with a company that doesn't deserve our business.

[TBoneTX 45,266]

Try Amica.

[jdba 22]

It's because after you sign they send someone out to actually look at the house. That person decides what you need to fix. I had that we State farm after I renewed the 2nd time. They wanted me to replace the roof even though it was only 7 years old and had no signs of damage, wanted me to repaint the house and put up a rail on all areas outside that had 3 steps or more. And only gave me 90 days. I changed to Allstate.

[Mike-eeh and Odie 193]

We use GEICO.

[SusieQQQ 11,586]

It's because after you sign they send someone out to actually look at the house. That person decides what you need to fix. I had that we State farm after I renewed the 2nd time. They wanted me to replace the roof even though it was only 7 years old and had no signs of damage, wanted me to repaint the house and put up a rail on all areas outside that had 3 steps or more. And only gave me 90 days. I changed to Allstate.

But there was nothing to fix. It was things like add a linked fire alarm and stuff that they didn't need to see the house for... That's why we are so confused.

We use GEICO.

That's who we used, well they are about to lose our car business too when we switch... Edited October 3, 2015 by SusieQQQ

[Boiler 45,467]

As an aside the Insurance biz in the US is highly regulated, amazingly so.