Hard questions: what Florida home insurers need to know about you

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You’ve taken all the right steps.

You’ve purchased a home that’s located not too close to the beach, away from the major flood zones and in a neighborhood with a low crime rate. And yet, you’re still being classified as a high-risk policyholder by most home insurance companies in Florida. Why is that?

Well, it may have to do with your personal background.

How does this affect my premium?

A homeowner's past can greatly influence his or her eligibility for home insurance. 

Some factors could make you ineligible for certain policies or subject to higher premiums. Other factors could disqualify you from homeowners insurance altogether, depending on the company. And it’s not just the homeowner’s past. Insurers take into consideration the background of all the residents within a household.

Many insurers take into consideration a number of factors as a way to assess risk. Some of these include:

  • Recent bankruptcy
  • Recent foreclosure
  • Felony convictions
  • Previously having sued a home or auto insurance company
  • Having a policy cancelled due to insurance fraud
  • Having been convicted of arson
  • Having been denied coverage
  • Currently a smoker
  • Having lapsed in insurance coverage
  • Having filed certain claims in the last five years

I had a bankruptcy/foreclosure several years ago. Does it matter?

This depends on the insurer, but typically your bankruptcy or foreclosure is only relevant if it occurred in the last five years. If your bankruptcy occurred ages ago, you may not need to inform your insurer.

But if your bankruptcy or foreclosure is nearing its end, you should definitely reach out to your agent to see if you can re-apply for a better or cheaper home insurance policy. 

Because many insurers look at bankruptcies within the last five years, you may need to wait a couple of years before seeing a difference in your premium. However, not all insurers are the same, it would definitely be worth a try. 

Why are my previous claims important?

Another major factor that influences a homeowner’s eligibility is his or her claim history. Many insurance companies will not underwrite individuals who have made a certain number of claims, or certain types of claims, within a given period. But this depends on the specific company.

The good news is that many insurers do not look down upon previous claims that are considered “Acts of God”. For example, claims as a result of a hurricanes or earthquake do not work against the insured.

If you’re thinking it now sounds impossible to obtain insurance, you would not be alone. It was because of these strict rules that the Florida Legislature in August 2002 created a not-for-profit home insurance company. Citizens Property Insurance Corporation offers insurance protection to Florida policyholders who are entitled to but are unable to find coverage in the private market.

Unsure if you qualify? Find out now by visiting HoneyQuote.com, which lets you compare prices from insurers around Florida.

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