Did you know that insurance companies use the ability to deny or cancel home coverage to encourage homeowners to maintain safe electrical systems? Home insurance cancellation for electrical code compliance is not as scary once you learn what goes into these evaluations.
Home Insurance Cancellation for Electrical Code Compliance
Everything starts with the assessment of the property’s electrical system. Of course, not many people have seen an insurance agent come and evaluate their electrical systems. These assessments are done during specific times. Electrical systems can be reviewed during any of the following processes:
- Initial Policy Applications
- Home Inspections
- Policy Renewals
- Claims Investigations
- Updates to Company Underwriting Guidelines
Insurers are looking for common electrical issues such as:
- Outdated Wiring
- Inadequate Electrical Service
- Overloaded Circuits
- Ungrounded Outlets
- Federal Pacific Electric or Zinsco Panels
- DIY Electrical Work without Permits
- Exposed Wiring
- Lack of GFCI Protection in Wet Areas
What Leverage Do Insurance Companies Have?
Home insurance cancellation for electrical code compliance seems like a massive jump from overloaded circuits. Of course, insurance companies do have different tools they can use to encourage electrical care in homes. For example, they can deny coverage, provide conditional coverage, increase premiums, and lastly, cancel your policy.
Conditional coverage typically gives homeowners 30-90 days to perform any electrical upgrades required for full coverage. Swink Electric can help ensure this process goes smoothly.
Compliance Timeframes for Electrical Upgrades
Insurance companies sometimes give homeowners time to comply with any upgrade requirements to start a policy. Timelines are strict, so homeowners should be ready to call Swink Electric to start the process. New policies are typically given 30-60 days to comply, and existing policies generally are given 30-90 days to correct any issues.
Most insurers will consider a reasonable extension if licensed electricians confirm work is scheduled. Another consideration can be awarded if weather plays a role in compliance delays. All of this is done under the regulatory constraints handled by state insurance departments.
What You Can Do
Homeowners want to avoid home insurance cancellation for electrical code compliance issues. Luckily, Swink Electric can help. Homeowners will need to comply with requirements or seek insurance from specialty insurers, which can cost a premium. We will do all we can to help your insurance company know we are actively working to resolve the problem throughout the process.
Why This is Important
Electrical issues can be hazardous, and home insurance cancellation for electrical code compliance is the least of anyone’s worries. Electrical issues found during inspections are often only called out when they pose a risk. Those risks include increased fire hazard, liability for injuries, difficulty selling a home, reduced property value, high electrical damage expenses, and even a possible mortgage default.
Swink Electric has a team of electricians who are ready to help. Contact Swink Electric today to schedule your electrical inspection.