9 Reasons Insurers Can Cancel Car Insurance Policies

There are a lot of opportunities to win at gambling in Reno. Whether you’re playing the slots or roulette, there will always be a risk. One area where you don’t want to gamble is with your insurance.

You’re not obligated to carry health or homeowners’ insurance if you own your home outright.

However, you must carry homeowners’ insurance if you have a mortgage. You also need to carry automobile insurance.

In Nevada, drivers must carry liability insurance with the following minimums:

• $25,000 bodily injury liability per person
• $50,000 bodily injury liability per accident
• $20,000 property damage liability per accident

You would be responsible for all the charges if you got into a car accident without liability insurance.

What if your insurance company suddenly cancels your policy, leaving you without coverage? This could be an example of acting in bad faith. The Law Office of Matthew L. Sharp has helped many clients take on powerful insurance companies that are acting in bad faith with their cancellation policies.

However, there are legitimate reasons why insurers cancel policies. Here are nine reasons for the cancellation of the car insurance:

Failure to Disclose Necessary Information in Your Application

An insurance company can promote a particular rate, but it will always be “subject to approval.”

That “approval” will be based on the information you provide on your application. For instance, you’ll be asked who will be driving your car or if you’re “garaging” it. If you fail to disclose this information accurately, your insurance could be canceled.

One common error is when parents leave off their teen drivers.

Driver’s License or Vehicle Registration Was Revoked or Suspended

Insurance companies want to provide coverage for licensed drivers and registered vehicles. If your license or registration is suspended, your policy could be canceled. Additionally, if you added a driver with a suspended license to your policy, you need to exclude them from the policy or risk cancellation.

Making a Fraudulent Claim

Fraud is an issue that every insurance company takes seriously. Any time you file a claim, you are expected to tell the truth about the circumstances surrounding the claim. If it’s found that any part of your claim is fraudulent, your policy can be canceled.

A Medical Condition Impacting Your Ability to Drive Safely

Every driver must pass an eye test in order to obtain a license. If you fail the eye test, you won’t be given a license, which could trigger a cancellation. Other medical conditions, such as epilepsy or other neurological diseases, could impact your ability to drive safely.

You would need certification from a doctor who clears you for driving in order to avoid cancellation.

DUI Conviction

If you are convicted of a DUI, your insurance carrier can either raise your rates or cancel your policy outright. You might be able to obtain an SR-22 Insurance policy, which is also referred to as a Certificate of Financial Responsibility, and must be put on file with the DMV.

Unsafe Car

The road you drive on can sometimes be unsafe, but you don’t have control over that. You do have control over mechanical issues that would make your car unsafe to drive. Brake failure or a broken windshield would be good examples of these.

Your insurance company might not be aware of these problems before an accident, but if they are discovered to be factors in the accident, your claim could be denied and your insurance canceled.

Using Your Car for Business

If you use your car for business, you will need a commercial auto policy. This does not include driving to lunch or meetings, but jobs like visiting businesses to conduct an inspection or making deliveries.

Driving Passengers for Hire

If you are using your car to drive for Uber, Lyft, or any other rideshare company, you are required to carry specific rideshare insurance. You can’t use your personal insurance.

If you get into an accident while driving passengers for hire without rideshare insurance, your claim could be denied and your policy terminated.

Car Insurance Cancellation vs. Non-Renewal

Your car insurance could also be canceled if the insurance company opts not to renew. They could make that decision based on any of the above reasons. Your policy could also be canceled for non-payment.

If you feel like your policy was canceled unfairly, you should reach out to the Law Office of Matthew L. Sharp. We can review your policy and answer any questions you have about your cancellation.

It’s vital that you resolve that matter and get back on insurance as soon as possible.