The state of Florida's property insurance market is perceived as being, shall we say, volatile - with premiums on the rise and coverage options narrowing for many owners to keep affordable coverage. But when claims can take time to resolve (especially when many inspections or appraisals are involved), some property owners wonder if they can explore other coverage options while their claim is still open.
Currently, state regulations do not explicitly prohibit obtaining new insurance while having an open claim. While we do have compliance rules to follow that are overseen by The Florida Office of Insurance Regulation (OIR), it does not mandate specific rules about issuing new policies when there is an open claim. Although, this allows insurers to exercise discretion based on their risk management strategies. Individual insurers may have their own rules and risk assessments that influence their willingness to issue a new policy under these circumstances.
Insurance companies may consider the nature and status of the open claim before deciding to issue a new policy. For instance, if your open claim is for a minor issue, an insurer might be more willing to provide new coverage compared to a situation involving a significant, unresolved claim.
You’re not alone. Should you have other claims questions or want to discuss your unique case, please contact our legal team led by Kyle Staggs, Esq..
Must I Disclose It?
Yes. We believe all sides should act in good faith.
Policyholders seeking new insurance while having an open claim should be prepared to provide detailed information about the claim to potential insurers. Insurers assess the potential risk and liability associated with the open claim to make informed decisions. Transparency and clear communication can help facilitate this underwriting process. Additionally, working with an experienced insurance agent can provide valuable guidance and increase the chances of securing new coverage.
The new insurance company may view you as a higher risk, especially if the open claim is substantial. This could ultimately result in higher premiums or even denial of coverage. New insurers often scrutinize your claims history, and an open claim could negatively impact their assessment of your risk profile.
Let's talk about what that may mean for you and what your best options are to close the claim successfully.
What Documentation is Needed to Apply for New Insurance?
To apply for new home or business insurance in Florida while you have an open claim, you'll need to provide comprehensive documentation to the prospective insurer. One of the primary documents required is a completed insurance application form. This typically asks for detailed information about the property, such as its location, size, age, and construction type, and any existing safety features like smoke detectors or security systems.
Your agent may also want to review your current insurance policy. This helps them understand the existing coverage, limits, and any endorsements or riders that may be in place. It also provides insight into the history of claims and the level of risk associated with insuring your property.
Remember, you will need to provide a detailed claims history report. This should include information about- in your case – the open claim, such as the date of the incident, the nature of the damage or loss, the estimated cost of repairs or replacement, and any steps you've taken to mitigate further damage. This helps the new insurer assess the potential risk and determine appropriate coverage and premiums.
Additionally, you may need to provide photographs or videos of the property, especially areas affected by the open claim. Visual evidence provides a clear understanding of the current condition of the home or business, and the extent of the loss. This can be particularly important if the open claim involves significant or visible damage.
Financial documentation is also important. For business insurance, this may include financial statements, tax returns, and proof of income. For home insurance, you may need to provide proof of ownership, such as a deed or mortgage statement, and possibly a recent property appraisal. These documents help the insurer evaluate the value of the property and the financial stability of the applicant.
Your potential insurer may ask for you to provide contact information for any contractors or repair services involved in addressing the claim. This allows the new insurer to verify the status of repairs and the estimates or invoices related to your claim.
Can Switching Insurers Impact My Current Claim?
The primary concern is that the new insurer will not cover any damages or losses related to the ongoing claim. This is because insurance policies typically do not cover pre-existing conditions or incidents that occurred before the policy's inception date.
Your current insurer is obligated to handle and settle the claim that was filed while your policy with them was active. However, switching insurers does not absolve you from the responsibilities and obligations you have under the existing claim. You must continue to cooperate with your current insurer to ensure the claim is processed and resolved properly.
Switching insurers in the middle of a claim may complicate the insurance claims process. But that is typically if the transition leads to communication gaps or misunderstandings between you and the policyholder.
Before making any decisions, it is advisable to discuss your situation with an insurance advisor or broker who may be able to offer valuable insights tailored to your unique circumstances.
Contact Florida Property Damage About Your Claim
Each claim - like each case - is unique. If you have additional questions or need professional advice about your insurance situation, Kyle Staggs, Esq. has a detailed understanding of Florida insurance law. And he can provide you with the clarity and peace of mind you need during this challenging time.
Don't navigate the complexities of insurance claims on your own — contact the Florida Property Damage law firm today for a no-obligation consultation.
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