Posted: Dec. 12,  2003

Insurance Commissioner candidate Matt Denn said Friday that Delaware should join the increasing number of states that are offering protections for homeowners against having their homeowners insurance policy canceled after making claims. 

“It is unfair for Delaware families to lose their homeowners insurance because they made one or two small claims,” Denn said. “Many of these families have been paying for insurance from the same company for 10, 15 or 20 years without ever making a claim. Delaware should not allow them to be rendered uninsured simply because they had one or two minor claims.” 

Denn said a number of states have begun to regulate the degree to which insurers can refuse renewal of a homeowner’s policy just because the homeowner has made a claim.  

“Different states have taken different approaches but a number of reasonable, fair rules have been implemented in other states,” Denn said. “Delaware should implement a rule that is fair to the insurance industry, but also protects the rights of homeowners to use the homeowners insurance they have paid for when they have a good reason to do so.” 

According to the Independent Insurance Agents and Brokers of America, one of every 27 American families have lost their homeowners insurance in the past two years. Many of those losses are due to “non-renewals,” where insurers refuse to renew a homeowner’s policy at the end of the year, on the grounds that the homeowner has made claims against the policy. The homeowner’s problem is compounded because his or her “non-renewal” is reported to a national database available to all insurers, making the homeowner appear to other insurance companies to be an undesirable customer.

 According to the Insurance Commissioner’s Office, complaints in Delaware regarding canceled homeowners insurance are spiraling: they are up 47 percent in the past year, and 100 percent over the past two years. 

Denn said the Delaware Insurance Commissioner has the ability through regulation to protect homeowners from non-renewal for making claims. He said that that such protection would be one of his first priorities once elected if the issue is not addressed in the next year.