The Importance of Communication with One’s Insurance Agent
When it comes to homeowners’ insurance, one of the most important details to get right is the residency requirement. If the insurer’s policy requires that the home be owner-occupied at the time the policy goes into effect, you have to ensure that this condition is met. Otherwise, you may find yourself in a situation where your claim is denied, leaving you with little recourse.
This is exactly what happened in a recent situation where an insured filed a claim after a winter storm caused significant water damage to their property. The problem? When the insurance company investigated, they found that the home was vacant and under construction, which violated the terms of the policy.
Now, you might be thinking, “But the homeowner intended to move in soon—shouldn’t that count?” Unfortunately, it doesn’t. The insurance policy required that the home be occupied at the time the policy went into effect. Even though the homeowner planned to move in eventually, that wasn’t enough to trigger coverage.
What Went Wrong?
The insured had applied for the homeowners’ insurance in January 2021, stating that the property was owner-occupied, not under construction, and free from significant damage. Based on this information, the insurer issued the policy. But when the winter storm hit and caused damage, the adjuster found that the home was not actually being lived in—it was vacant and under construction.
The insured tried to argue that they planned to move into the property soon, but the insurer stuck to its guns, citing the clear terms of the policy. The application stated that the home had to be occupied at the time the policy began, and since that wasn’t the case, the insurer denied the claim.
The Importance of Accurate Information
This situation underscores just how crucial it is to provide accurate information when applying for homeowners’ insurance. Even small discrepancies—like stating that a home is occupied when it’s not—can lead to big problems down the line.
In this case, the insurer denied coverage because the terms were clear: the policy only covered homes that were occupied at the time the policy started. Even if the homeowner’s intent was to move in soon, the policy’s language didn’t provide coverage for vacant homes or properties under construction.
Key Takeaway: Get It Right From the Start
The key lesson here is simple: when applying for homeowners’ insurance, always be sure that the information you provide is completely accurate. If the policy requires the home to be owner-occupied, make sure the home is, in fact, your primary residence at the time the policy goes into effect. Otherwise, you could find yourself in a situation where your claim is denied, leaving you with significant out-of-pocket costs.
When speaking with your insurance agent, be clear and upfront about the status of your property to ensure that you’re fully covered in the event of damage. It’s always better to be safe and honest from the start than to face a denied claim later on.