Managing Money In A Crisis
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Does home insurance offer premium forgiveness during the coronavirus outbreak?
Understand the ins and outs of delaying your home insurance payment.
Many major home insurance companies are working with customers facing financial strain due to lost income during the coronavirus pandemic. Only a few companies haven’t responded to the coronavirus situation officially. But even these companies may be required to extend payment dates in states that are mandating longer insurance grace periods.
We’ll update this page as new details emerge in the world’s response to COVID-19.
Will my home insurance let me skip a payment?
Most home insurance companies are encouraging customers to reach out if the coronavirus outbreak is limiting their finances. Companies have offered customers payment assistance, with a few companies taking bigger steps to relieve financial strain.
State orders
Some states like California are extending insurance grace periods to at least 60 days in an effort to help customers during the current economic downturn.
Checked as of July 10, 2020, individual companies are helping customers:
| Company | How are they helping? | Contact information |
|---|---|---|
| Allstate |
| MyAccount login or mobile app Your local agent Call 877-810-2920 For identity theft protection, sign up at Allstate identity protection |
| American Family | The company acknowledges some customers need financial help. It encourages you to discuss payment options with a rep. | Call 1-800-692-6326 Contact your local agency |
| Assurance | No direct COVID-19 response on its website. Its customer service team wants to help with your policy from beginning to end, including modifying coverage when needed. | Call 844-334-1948 |
| Geico | Geico is offering flexible and special payment plans to customers in need, including partial payments. | Geico app or geico.com account Check the customer service number on your policy Otherwise, call 888-395-1200 |
| Kin | There’s no direct COVID-19 response on its website. But Kin leaves the door open for you to contact by phone from 7 a.m. to 7 p.m. CT on weekdays and from 8 a.m. to 3 p.m. on Saturdays. | Call 855-717-0022 Email support@kin.com |
| Lemonade | The company is helping customers and the community weather these hard times by:
| For questions, contact customer service via the app |
| Liberty Mutual | This insurance giant is helping customers with flexible payment and overdue balance payback options:
| Liberty Mutual app or online account Call 800-290-7933 Tweet @AskLiberty |
| Progressive | The insurer says it’s committed to supporting its customers. Progessive encourages customers to contact support if still experiencing financial difficulty. | Chat through the Progressive app or online account Call 1-888-671-4405 |
| State Farm | State Farm is standing by to help those whose lives are disrupted by COVID-19. You can learn about payment options most efficiently from your local agent. | Your local agent |
| Farmers Insurance | This well-known home insurer is taking multiple steps to help customers, including:
| You must call 888-327-6335 to extend payments further or pause cancellations |
| USAA | USAA is on a mission to care for its members during hard financial times. The company is providing special payment plans to those who need extra flexibility. | Mobile app or usaa.com account Call 800-531-8722 |
How do I delay my home insurance premium?
Take advantage of benefits your insurer is offering during the coronavirus:
- Get in touch with your insurance company. You might get the fastest service through local agents or online services like chat or email. But if you have to call customer service, expect longer wait times than usual.
- Explain your financial situation. You might include details about when you expect to be able to pay or the payment amount you can currently handle.
- Ask about delayed or deferred payments. Your insurance company may extend your payment due date, waive late fees or postpone policy cancellations to ease any financial burdens.
- Put dates on the calendar. Write down or set reminders about an extension to avoid missing the new date.
How long are home insurance grace periods?
The grace period may range from 10 to 30 days, depending on your state’s requirements and the insurance company. If you’re late on your home insurance payment, your insurer is usually required by the state to cover you for a certain time after your last payment due date.
What should I do if I can’t get a premium extension?
You might not want to skimp on home coverage in case of an accident or hardship. But you could find a few ways to lower your premium. Weigh your personal and financial situation carefully before requesting any changes to your policy.
- Review your optional coverage. Consider dropping or lowering your annual limits on optional coverage like equipment breakdowns or siding protection. If you bought home-sharing coverage for your Airbnb or other home rentals, you could save by dropping it while you’re not renting. But be sure you don’t need helpful benefits from your home-sharing policy like lost rental income first.
- Total the actual value of personal belongings. Think about the cost of replacing your belongings, including your furniture, computers, tools and appliances. If you haven’t already, this might be a good time to take a detailed inventory of your personal belongings. Consider adding the item’s name, description, model number and any photos or receipts. If the cost totals less than your personal property coverage, you could lower your annual limit.
- Look at new insurance policies. Consider shopping around for another home insurance provider, especially if you haven’t looked around in a while. But if you switch, make sure you’re getting comparable or better coverage and service, so you don’t regret switching later. Keep in mind you’ll likely experience long wait times if you’re switching over the phone.
- Consider raising your deductible to a higher amount you could still afford. Though raising your home insurance deductible to save on premiums is a quick fix, it’s not the right option for everyone. But make sure paying your new higher deductible wouldn’t leave you strapped for cash if your home gets damaged and you need to make a claim. For example, you might go from a $500 deductible to $1,000 until you have more room in your monthly budget, as long as you can afford that extra $500 come claim time.
Compare home insurance policies
How else can the coronavirus affect home or renters insurance?
Most homeowners and renters won’t see much difference in their coverage. But you might see changes in your customer service wait times or in a few other specific situations:
- Waiting longer on the phone. Customer service reps may be taking more phone calls to help customers who can’t make payments. So expect longer waits if you’re making updates to your policy by phone.
- Relying on virtual claims. Because of social distancing, many companies are using virtual methods to handle claims. You may need to sign documents and communicate by phone or email more than usual. Adjusters may ask you to take a video or use video-conferencing of your home or damaged belongings for estimates. In some cases, your adjuster may inspect your home’s exterior without needing to meet with you.
- Losing home-sharing guests. Chances are you’re seeing a slump in home-sharing guests during the coronavirus. If you bought separate home-sharing coverage, see if your policy includes loss of use or lost rental income. If so, you could recover your expected revenue from your insurance until business picks up.
- Considering your own liability. You could get pinned with spreading the coronavirus or with claims for injuries on your property. If someone like your neighbor or injured pizza delivery guy files a claim against you, you need enough liability coverage for the legal costs. Also, you might review your policy to make sure there isn’t an exclusion for infectious diseases.
- Protecting against extra rental damage. Since you’re probably staying at home more, you chance damaging your rental more than you did before. This is yet another reason to review your personal liability coverage.
Is my home office covered by homeowners insurance?
It might be covered, but that depends on your policy. Some home insurance policies cover business property with low limits like $1,500. This may exclude equipment stored in a garage or shed. Keep in mind that, if you work for an employer, any work-related injuries or property damage is likely covered under your employer’s business policy.
Also, your standard policy may exclude home-based businesses, a concern if you’re the business owner. Whether you’re a business owner or employee, you may need an add-on for home-based businesses or a business owner’s policy if you don’t have coverage elsewhere. You can talk through your new work situation with your insurance company.
What happens if I can’t pay my insurance premiums?
Notify your insurance company right away if you expect to miss an insurance payment. Many companies are offering help with payments during the coronavirus outbreak. However, if you don’t contact your company, you can expect some repercussions to follow:
- Your insurance company will send a notice. Your home insurance company will notify you about your policy’s cancellation date, typically by mail. It’s required to give you ample time to see the notice and respond.
- You still have coverage until the cancelation date. The grace period ends on the date written in your cancelation notice, so you’ll have home insurance coverage until then.
- Your mortgage lender may place you with insurance. Your home loan agreement probably requires you to keep a certain amount of coverage on your home. If you don’t, your lender can match you with a force-placed policy to cover its investment. This policy tends to involve high premiums for less coverage than traditional home insurance.
- You could get denied coverage. Your insurance company has the right to deny coverage if it deems you too risky to insure. You may have to shop for a high-risk home insurance provider unless you can work out an agreement with your old one.
Should I cancel my home insurance?
Not if you have a home loan. Your mortgage lender likely requires home insurance in your contract. If you violate the terms of your contract, your lender technically can foreclose on your home.
However, some lenders like Fannie Mae and Freddie Mac are working out special plans for mortgage payments or offering forbearance for homeowners in financial distress. This option may not affect your requirement to keep home insurance, but it can take some pressure off home-related expenses. Call your lender to see what financial relief options it may be offering during this time.
If you don’t have a home loan, you’re not typically required to have home insurance. But consider that without a home insurance policy, you’re left paying out of pocket for damage.
Around 5% of homeowners file a claim every year, according to the Insurance Information Institute, and the average claim amount totals just over $12,000. Unless you can pay out of pocket for catastrophic damage, it’s probably a good idea to keep your policy active.
How do I reinstate my home insurance policy?
You might call your home insurance company to see if you can reinstate your policy without showing a lapse in your history. However, you have a better chance at reinstating coverage if you call soon after the lapse. Keep in mind you’ll need to catch up on payments to get your policy reinstated.
Bottom line
If you’re concerned about missing a home insurance payment, insurance companies are offering due date extensions as their main line of support. That combined with other steps like reviewing your coverage can help you stay financially secure during the coronavirus.
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