Common Insurance Application Questions

Insurance Cancellations or Refusals

You should answer “Yes” to this question, if your insurance has not, in the last 5 years, been cancelled, non-renewed or refused by an insurance company. Reasons a company could have for this include misrepresentation, non-disclosure, objectional claims history or non-payment of premiums. These types of cancellations and refusals need to be included in your quote. Not only could this affect your rate but also your eligibility for insurance which may result in voiding your insurance completely which could result in non-payment of claims.

If you have never had your insurance cancelled or refused by an insurance company, then you should answer no. If you cancelled the policy yourself, were cancelled because your property value exceeded the maximum allowable by the insurer, your coverage requirements changed or your broker discontinued their contract with your insurance company, this would be not be considered an involuntary cancellation and it would still allow you to answer “No”.

For further clarification contact an Awywi representative who can answer your questions.

Insurance Claims

If you have too many claims (claim amounts may make a difference as well) on your insurance record, most insurance companies will charge you a higher rate for coverage. Not only could this affect your rate but also your eligibility for insurance which may result in voiding your insurance completely which could result in non-payment of any claims made under this policy.

Take this question seriously and remember most insurance companies share in and have access to national claims and fraud database. A knowingly false declaration of claims experience may cause your insurance to be cancelled.

Awywi strongly encourages you to answer all questions regarding claims honestly and completely. For further clarification contact an Awywi representative who can answer your questions.

Insurance Deductibles

Deductibles have been an essential part of the insurance contract for many years. Understanding your deductible is an important part of getting the most out of your insurance policy.

Deductible defined

A deductible is an amount of money that you yourself are responsible for paying toward an insured loss. When a disaster strikes your home or you have a car accident, the amount of the deductible is subtracted, or “deducted,” from your claim payment.

Deductibles are the way in which a risk is shared between you, the policyholder, and your insurer. Generally speaking, the larger the deductible, the less you pay in premiums for an insurance policy.

A deductible can be either a specific dollar amount or a percentage of the total amount of insurance on a policy. The amount is established by the terms of your coverage and can be found on the declarations (or front) page of insurance policies. 

How deductibles work

For dollar amount deductibles, a specific amount would come off the top of your claim payment.

For example, if your policy states a $500 deductible, and your insurer has determined that you have an insured loss worth $10,000, you receive a claims check for $9,500.

Deductibles generally apply to property damage, not to the liability portion of insurance policies. To use a homeowners policy example, a deductible would apply to property damaged in an accidental kitchen fire, but there would be no deductible against the liability portion of the policy if a burned guest made a medical claim or sued.

Raising your deductible can save money

One way to save money on an insurance policy is to raise the deductible so, if you’re shopping for insurance, ask about the options for deductibles when comparing policies.

Increasing the dollar deductible from $200 to $500 on your auto insurance can reduce collision and comprehensive coverage premium costs. Going to a $1,000 deductible may save you even more.

Most homeowners and renters insurers offer a minimum $500 or $1,000 deductible. Raising the deductible to more than $1,000 can save on the cost of the policy.

Of course, remember that in the event of loss you’ll be responsible for the deductible, so make sure that you’re comfortable with the amount.

Disaster deductibles

Wind/hail and hurricanes are covered by standard “Broad Form” insurance; flood and earthquake coverages or policies are purchased separately. But each of these disasters has their own deductible rules. If you’re in an area that’s high risk for one of these natural disasters, understand how much of a deductible you’ll need to pay if a catastrophe strikes.

Wind/hail deductibles work in a similar way to hurricane deductibles and are most common in places that typically experience severe windstorms and hail. These include Midwestern states (like Ohio) and around Tornado Alley (which goes through Texas, Oklahoma, Kansas and Nebraska). Wind/hail deductibles are most commonly paid in percentages, typically from one to 5 percent.

Flood insurance offers a range of deductibles.  If you have—or are considering buying—flood insurance, make sure you understand your deductible. Flood insurance deductibles vary insurance company and are available in dollar amounts or percentages. It is important to understand that your mortgage company may require that your flood insurance deductible be under a certain amount, to help ensure you’ll be able to pay for it.

Earthquake insurance has percentage deductibles that are anywhere from 2 percent to 20 percent of the replacement value of your property insured.

For further clarification contact an Awywi representative who can answer your questions.