Delaware Insurance Commissioner Matt Denn has issued a bulletin to property insurance companies telling them to better inform property owners of the option of coverage from the residual market, the FAIR Plan.
The bulletin came as the result of notice by Westfield Insurance Company of Ohio that it will not renew 850 homeowner and commercial property insurance policies in coastal Sussex County.
In the bulletin, Denn directed that homeowners and businesses whose policies are not being renewed be informed about the importance of having insurance and of the existence of the Delaware FAIR Plan, which will provide homeowners and commercial property insurance to anyone who cannot obtain a policy from a private insurer.
He said that affected homeowners and businesses should also know that there are a number of insurance companies that are still writing new policies in coastal Sussex. He urged them to check with an agent or contact a number of companies.
According to Denn, Westfield Insurance has begun notifying its homeowner and commercial property policy holders within two miles of the coast in Sussex County that their policies with Westfield will not be renewed once they expire. The company, which sells policies under the names Westfield Insurance, Ohio Farmers Insurance and Old Guard Insurance, says it has not sold any new property policies in the area since 2002.
Westfield’s actions are part of a trend throughout the East coast of insurance companies canceling or not renewing property policies in areas of the country considered at risk for tropical storms or
“First, I am disappointed in Westfield’s decision, but my office and I will do anything we can to help the affected people and businesses in Sussex County obtain new coverage in the short term,” Denn said. “Unfortunately, it is a business decision on Westfield’s part and there is no law prohibiting Westfield from taking this action.”
Denn said he is directing insurers to make sure that affected homeowners and businesses know that a property policy can almost always be obtained from the Delaware FAIR Plan if they cannot get coverage from any insurance company. “The FAIR Plan should be a last resort for obtaining property insurance, but it’s one people should be aware of,” Denn noted.
Information about the Delaware FAIR Plan can be obtained from an agent or found online at www.defairplan.com.
Denn also said that he intends to meet with the consortium of insurance companies that make up the FAIR Plan as well as the plan’s administrators to determine if any changes need to be made in plan to accommodate Westfield’s non-renewals or those of other
companies in the future.
“The FAIR Plan is designed as a safety net and I want to make sure it will be there for Delawareans who need it if the insurance industry continues to terminate policies on the Delaware coast,” Denn said.
Source: Delaware Commissioner Matt Denn
Was this article valuable?
Here are more articles you may enjoy.