What are the consequences of a missed home insurance payment?
Missing an insurance payment will usually be an oversight, but if you don’t think you can afford to make the next payment, then it’s important to speak to your insurance provider immediately; they may suggest an alternative payment date for when you do have cash in the bank. Whatever you do, don’t go all ostrich and bury your head in the sand – because it’ll come back to bite you.
You don’t need us to tell you that missing any sort of payment is bad. The consequences aren’t just immediate but it could affect your long term credit history. According to credit check company Experian, your credit report shows any missed payments for the last six years. Having a record of missed payments will have a negative impact on your credit score meaning you could struggle to get a credit card, mortgage or loan in the future.
Not paying your monthly home insurance premium means your policy could lapse. In your terms and conditions your provider has probably stated something along the lines of you needing to keep up with payments to ensure your policy stays active. If you don’t, they can issue you with a cancellation notice. Not having an active home insurance policy means that there’s no pay-out if something happens to your home or contents such as incidents of theft, fire, flood or storm damage. Having your home insurance cancelled can also have other consequences – you can find out more here.