Will State Farm cancel my insurance after 3 claims?
UPDATED: Jun 24, 2014
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Asked June 24, 2014
The number and amount of your liability insurance claims are kept on record for a period of 7 years. This includes claims against your home insurance as well as auto insurance and any other liability policies you have, such as an umbrella policy. Insurance companies can use this information to determine when a particular customer's risks outweigh the benefits of providing insurance to them.
If you filed 3 claims in a relatively short period of time, or if one or more of those claims was for a relatively high amount, your current insurance company may decide not to renew your life insurance policy at renewal time. They could decide to terminate your policy completely, but most insurers will wait until renewal which is when the insurance policy comes up for review. You will likely be subject to a cancellation fee. Your insurance agent will discuss this at the time of coverage cancellations by phone; it would appear in letters in the event of coverage cancellation by mail.
You can always contact the customer service department and ask your customer service agent for a reason regarding the cancellation of your policies because there are many reasons people can lose their insurance policy coverages. These range from insurance lapses, to being reclassified as a high-risk driver. With that information in hand, you can then decide whether you want to appeal the decision. Unless you have definite reasons for sticking with this company, you may find it easier to simply switch before the cancellation is effective.
In some cases, you may have a partially or entirely unused premium leftover because you have already made your insurance bill payment, or have automatic payments on your policies. Depending on your cancellation policy and coverage, your current insurance provider may be able to issue refunds of any excess you've paid in insurance premiums during your policy term.
To switch insurance companies, or to find a replacement provider if your auto insurance coverage, rideshare driver coverage, or homeowner's policy has been canceled, start with a brokerage website like this one. You will be able to get quotes on policies from multiple leading insurers, to help you get the best insurance rates and coverage available. Since the quotes come from different insurance companies, you cannot get this type of comparison when shopping through a dedicated insurance company, only when you deal with a broker. You will also be immediately aware of your discount eligibility when working with an agent, so this can be a good way to get cheap car insurance coverage.
It's important to look at your insurance coverage options as soon as you know that you're facing cancellation during your insurance policy term. You can't drive your vehicle without insurance. Drivers have a responsibility to maintain the state minimum level of insurance and keep current proof of insurance in all their vehicles. Failure to provide proof of insurance, in the form of insurance cards, can result in your suspension of driver privileges and your license. Any time one of your policies is canceled for non-payment or any other reason, your auto insurance carrier is going to notify your local DMV.
Answered June 24, 2014 by Anonymous