Preventing Cancellation Or Nonrenewal Of Your Auto Insurance Policy

Getting a notice of cancellation or nonrenewal on an automotive insurance policy can be startling and leave the policyholder wondering what to do next. If an insurance carrier cancels or doesn't renew a policy because of your behavior, this can lead to higher premiums with the company you switch to. Learn the reasons that auto insurance companies cancel or decline to renew policies so you can prevent this from happening to you. 

Having Too Many Citations or Accidents

Receiving citations for speeding or other moving violations is a red flag to insurance carriers because the cited behavior is a risk factor for collisions. That puts you at risk of policy nonrenewal. If your license is suspended because you have too many tickets within a relatively short time, the insurer may cancel your policy outright.

Policyholders that cause vehicle accidents cost the insurer money. Although drivers have insurance to cover them in the event of a collision, the insurer naturally wants to minimize its payouts. More than one collision within a certain time frame can lead to nonrenewal. 

Getting a DUI Conviction

Driving under the influence of alcohol is considered high-risk behavior, and many companies will not provide coverage for anyone convicted of this offense within the past several years. If that's true for your insurer, you'll need to find a company that does cover DUI offenders, and your premiums will be substantially more expensive.

Making a Fraudulent Claim

Examples of fraudulent claims include exaggerations of vehicle damage or lying about how a collision happened. For instance, a vehicle owner might accidentally back into a utility pole and then claim that the vehicle damage was due to a hit-and-run while it was parked somewhere. If the insurance company learns what actually happened, the policy can be canceled.

If the insurance company files a fraud lawsuit, the individual is in bigger trouble now, since insurance fraud is illegal in all states.

Being Late on Payments

Multiple late payments may lead the insurer to decide a customer is more of a hassle than it's willing to deal with. Every time the policyholder doesn't pay on time, there's a lapse in coverage and sometimes a cancellation of the policy for non-payment. When the person does finally pay, the insurer has to start the coverage up again. This costs time and money, and makes the customer look irresponsible. 

Having an Insurer That Quits Providing Auto Insurance

Sometimes a company simply gets out of the automotive insurance business. In that case, you'll receive a notice of nonrenewal with an explanation. This is one circumstance you can't prevent, but it shouldn't cause your rates to go up when you switch to another company. Contact a local insurance company, like Winder Insurance Center, for more information.