Why can't I get insurance when a storm is coming?

Why can't I get insurance when a storm is coming?

| August 20, 2021

A storm is in the forecast, and you check your insurance coverage and decide you need to increase it, lower your deductible or add coverage to your policy. Most likely your agent told you that was not possible because a moratorium is in effect. Here's an explanation of a moratorium.

When a storm watch or warning is issued, or a major storm is in the forecast in your area with damage anticipated, agents will receive a message similar to this one that we received from our carriers during Tropical Storm Elsa in July 2021.

"A moratorium (as described below) is now in place. During the moratorium, coverage cannot be bound or amended in any fashion that increases exposure. This includes, but is not limited to: policy issuance, amending coverage, rewrites, and reinstates.

Delaware: Entire State

New Jersey: Entire State

New York: Entire State

Connecticut: Entire State

Rhode Island: Entire State

Massachusetts: Entire State

New Hampshire: Entire State

Maine: Entire State"

Once this notice is received, agents and brokers cannot increase the risk the carrier assumes, so no new coverage, reinstatements of coverage, changes to the policy or lowering of deductibles is permitted. 

According to the Insurance Information Institute at iii.org, temporarily suspending the ability for people to change coverage or get a new policy when a storm is imminent is a long-time practice. It prevents an insurance purchase from being made when the chances of having damage from a hurricane are greatly increased. “Insurance is available because the possibility of loss is unforeseen or unknown,” said Lynne McChristian, Florida representative of the I.I.I. “No one would offer insurance protection if a loss were a sure thing, and that is much more likely to happen when a storm is on the horizon.”

If you have not purchased insurance for your home, vehicle or boat, you will not be able to do so when storm watches and warnings exist in your area. Visit our Flood Quote and Homeowners Quote pages to shop for insurance now.

We're in the most active part of the Atlantic Hurricane Season now, and anticipate more storm warnings and watches will be issued in the coming weeks. We recommend you review all your insurance coverage now to make any changes needed. As always, we're here to help!