How many claims you can make before you insurance company will cancel or non-renew you will depend upon state laws as well as an insurance company's guidelines.
An insurance company does not necessarily cancel you for too many claims but will likely non-renew you. State laws for cancellations are usually more strict then those for nonrenewals.
For example the state insurance regulatory body for Florida states that an insurance company may cancel your policy after 60 days only if:
- you provide misinformation on your application or file a fraudulent claim. The company must give you a written notice of at least 45 days before it cancels the policy;
- the state suspends your driver license or vehicle registration. This also applies to any driver who lives with you or regularly operates a vehicle insured on your policy. The company must provide you with 45 days written notice before it cancels the policy; or
- you do not pay your premium. Your company must give you 10 days written notice before it cancels your policy. Many companies meet this requirement by simply mailing bills to policyholders at least 10 days before the due date, advising that the policy will cancel on a specific date unless the premium is paid. These companies may then cancel the policy on the listed date.
Nonrenewal is termination of an insurance policy at its normal expiration date. In Florida the following are examples of reasons for nonrenewal:
Accidents — Even not-at-fault accidents can lead to non-renewal if you or another insured on your policy have three within a three-year period. The company may also decide not to renew if you have a series of claims, including towing or comprehensive claims.
Traffic violations — An insurer may decide not to renew your policy if you receive a conviction for a major violation, such as driving under the influence (DUI) or leaving the scene of an accident. The company may also decide not to renew your coverage if you receive convictions for several minor violations.
Company guidelines — The company may elect not to renew your policy if you no longer meet underwriting guidelines. For example, you may no longer qualify if you attempt to add coverage for a sports car to your policy.
To see what your insurance company's guidelines are for cancellations and nonrenewals speak with your insurance agent. To find out what your state's insurance laws are regarding claims and if an insurance provider can cancel you after a certain number, contact your state's insurance regulator.