What would you do if the disaster insurance company defaulted on your policy?

Question

I hear that all around the Country, when disaster-prone regions receive higher than normal storms, seismic events, floods, etc; the Hazardous/Disasterous Insurance Companies just close up shop and move to safer regions.

I know, personally, of friends who paid for 25 years in a row for hurricane and earthquake insurance, and were dropped by the Insurance Companies, who all fled the region with all the other Insurance Companies. I think that is repulsive, sick, illegal, and a crime.

So, what do the Homeowners, who are in good standing do, when they cannot re-up, transfer, or buy new hazardous/disaster policies?

Answer 1

The first thing I would do is go to the National Association of Insurance Commissions website: www.naic.org, and file a complaint. Most companies will take care of those complaints rather quickly because they affect the companies ratings nationally.

The only other advice I can give for this situation is to talk to a lawyer, those contracts are usually upheld to the insureds benefit in a court of law.

Also, I understood what you were getting at with the question, the last answerer was being a jerk!

Answer 2

You should know what words mean before using them. What you described is not an insurance company defaulting on someone's policy. In this usage, defaulted would mean that somone has filed a claim but the insurance company doesn't have the money to pay it.

Remember, insurance companies are businesses and businesses are suppose to make money.

The reason they all left is that Federal and state laws limited the amount of the premium they could charge. So when a diaster type weather occurs, the insurance companies lose lots of money.