Cancellation of Homeowners Policy Because Owner-occupied House is "for Sale."

[ArtBuono]

Cross-posted this from Ask the Agents, sorry.

I just received advice from my agent that my homeowners insurer will be sending me a cancellation notice because they have learned that my house is for sale. I have several problems with this, starting with the fact that my house is not for sale. Second, I understand the policy of nonrenewal or cancellation when a house is vacant (whether or not for sale) or ceases to become the insured's principal residence, but I have never heard of a policy or underwriting guideline that would prohibit the owner of a principal residence, owner-occupied house from selling the house or listing it or offering it for sale.

I am working with my agent to relieve my insurer of its misapprehensions. But has anyone here ever heard of an insurer cancelling a policy simply because the owner decides to sell it - while he remains the occupant of the home as his principal residence? Could this be the practice/policy of a major, reputable insurer? What if I need or just want to sell my home? What would I do?

Thanks,

Art

 

[insurance1822]

Cross-posted this from Ask the Agents, sorry.

I just received advice from my agent that my homeowners insurer will be sending me a cancellation notice because they have learned that my house is for sale. I have several problems with this, starting with the fact that my house is not for sale. Second, I understand the policy of nonrenewal or cancellation when a house is vacant (whether or not for sale) or ceases to become the insured's principal residence, but I have never heard of a policy or underwriting guideline that would prohibit the owner of a principal residence, owner-occupied house from selling the house or listing it or offering it for sale.

I am working with my agent to relieve my insurer of its misapprehensions. But has anyone here ever heard of an insurer cancelling a policy simply because the owner decides to sell it - while he remains the occupant of the home as his principal residence? Could this be the practice/policy of a major, reputable insurer? What if I need or just want to sell my home? What would I do?

Thanks,

Art

In my state, if you're still occupying the home they can't cancel it for vacancy. If you've moved out they could (but there's no way they could know unless the agent told them OR if they inspected the property at renewal & saw a for sale sign.) To assume the home is vacant because there's a for sale sign is a bit presumptuous to say the least. If you have a crappy house w/ recent claims & I could see the agent working to get off the risk. If this is purely the insurance company jumping the gun off an inspection result of seeing a sign...your agent should fight that.

 

[dmetzger]

Is this a company you have been insured with and not a new company you just went to? If it is a new company in NY they can get off within the first 60 days for any reason and that is a question they do ask on the application.

 

[1manshow]

Who notified the carrier that you were preparing to sell? Just seems odd that they would be so proactive in re-underwriting their homeowners policies.

 

[rudy323]

It's a "better safe than sorry" attitude towards sending this cancellation.

Your address probably came up in a database that says your home is for sale and they send the cancellation and make it up to you to prove that you are still occupying it.

 

[Chevarian113]

This situation makes me wonder if something prompted to think the home was vacant due to being for sale, they asked for updates from the agent and got no response. Not blaming your agent, but it's a possibility, which sounds to be getting cleared up by the agent.