Department of Banking & Insurance Advises
Consumers of Options If Insurance Carrier
Non-Renews A Policy
NEW JERSEY – Department of Banking and Insurance Commissioner Ken Kobylowski recently gave consumers tips on how to handle a non-renewal notice from their auto or homeowner’s insurance company. A non-renewal means that a carrier does not intend to provide insurance coverage under the terms currently in force for a specific risk when the policy’s coverage expires.
“Insurers may decide not to renew a policy for a variety of reasons, such as increased risk or change in overall business plan, but they must follow strict guidelines and provide proper notice to policyholders,” said Commissioner Kobylowski. “A non-renewal can be inconvenient, but the end result doesn’t have to be bad news for a consumer. The State’s auto and homeowner’s markets are highly competitive and a non-renewal provides the opportunity for a consumer to shop around for a new policy that could lead to better coverage and improved service at a lower price.”
Non-renewal is permitted for auto and homeowner’s insurance under New Jersey State laws and regulations as long as licensed insurance carriers file certain timely notices to consumers. Other restrictions may apply, depending on the circumstances. Generally, a homeowner’s insurance company must mail or deliver a notice of non-renewal to the policyholder at least 30 days prior to the policy’s expiration date. For auto insurance, at least 60 days is required. Consumers who receive a non-renewal notice should follow these tips:
Auto Insurance Non-Renewal
- Contact the agent or carrier representative to clarify why the policy is being non-renewed.
- If the reason for the non-renewal is connected to a change in risk, find out what steps may be taken to reduce that risk.
- When changes to the risk are not the reason and if reversing the non-renewal decision is not possible, consumers should have adequate notice to shop around.
- Once a decision to shop around is made, consumers can go to the Department’s auto insurance purchasing planner found online here: http://www.state.nj.us/dobi/autoplanner.htm
- After selecting the coverage desired, contact at least three New Jersey State licensed carrier representatives or agents using this list: http://www.state.nj.us/dobi/division_consumers/insurance/autoinscontacts.htm
- Comparison pricing should be “apples to apples.” Make sure all policies quoted reflect the same limits and coverages to be sure that price shopping compares the same coverage terms.
- Be sure to get all available discounts from each carrier. Significant savings can be achieved with discounts such as for taking a safe driving course, bundling both auto and homeowner’s coverage with the same carrier, and having permanently installed anti-theft devices.
Homeowner’s Insurance Non-Renewal
- Contact the agent or carrier representative to clarify why the policy was non-renewed and if suggested improvements can be made to the home or property that might reduce the risk to maintain the current policy.
- If reversing the decision to non-renew is not possible, consumers should go to the Department’s website: http://www.state.nj.us/dobi/division_consumers/pdf/insuringyourhome.pdf
- After selecting desired coverage, contact at least three New Jersey State licensed agents or carrier representatives using this list: http://www.state.nj.us/dobi/division_consumers/insurance/homeownercontacts.htm
- Just as is the case for auto, make sure all policies quoted reflect the same terms to be sure that price shopping compares the same coverage.
- And do not forget to ask for any available discounts for features such as burglar alarms, smoke detectors, fire alarms and other mitigating factors.
Make Sure the Insurance Company is Licensed
- Verify the carrier or insurance agent quoting new coverage is licensed by the State of New Jersey.
- To confirm online that a company is licensed: http://www.state.nj.us/dobi/data/inscomp.htm
- To confirm online that an insurance agent is licensed: https://www20.state.nj.us/DOBI_LicSearch/insSearch.jsp
To File a Complaint
- Consumers who are unable to resolve an issue with a homeowner’s or auto insurance carrier should contact the Department at 609-292-7272.
- To file a complaint online go to: http://www.state.nj.us/dobi/consumer.htm and send in a copy of the non-renewal notice with your complaint.
For more information, go to:
Or call, 1-800-446-7467.