Property owners in Iowa experienced a series of severe weather events during the summer of 2022, leading to a spike in wind and hail damage.
But one of the state’s insurance regulators recently warned Iowa residents against filing too many claims from homeowners in response to this damage to avoid having their policies canceled or receiving a non-renewal notice.
“If they find damage when a storm hits, they go to their insurance agent and discuss their options with them,” Iowa Deputy Insurance Commissioner Jared Kirby said in a recent interview with NBC affiliate WHO-13 in Des Moines . The story aimed to educate consumers about the scenarios in which an insurance carrier might choose to cancel a policy or refuse to renew. “A lawsuit would be filed. That gives the insurance company a chance to come out and look at the damage, assess the damage, because the consumer might not be able to identify all the different things that are damaged.”
Kirby also said property owners might consider getting damage reports from a contractor without involving their insurance carrier. He encouraged Iowans who feel their homeowners insurance has been improperly canceled or a claim improperly denied to contact the Iowa Division of Insurance for assistance.
Cancellations and Non-Renewals
The Triple I reported that in 2020, nearly all homeowners’ insurance claims (97.7%) were for property damage, and just under half of those (45.5%) were due to hail or wind damage. The median property damage payout between 2016 and 2020 was $13,804.
According to Washington state sustainable construction company Urban NW Homes, the most common reasons homeowners deny insurance claims are:
- insufficient coverage;
- missed registration deadlines;
- non-payment of premiums;
- non-disclosure of facts;
- Insufficient documentation; and
- property wear.
Insurance companies can only cancel a policy that’s been active for more than two months if the premium hasn’t been paid or the policyholder has committed fraud or misrepresented information in their insurance documents, says the Rocky Mountain Insurance Information Association (RMIIA).
“Non-renewal is a different matter,” says the RMIIA. “Either you or your insurance company can decide not to renew the policy after it expires. Depending on the state you live in, your insurance company must give you a certain number of days’ notice and explain the reason for the non-renewal before dropping your policy.”