Understanding Insurance Policy Changes: What Homeowners in North Carolina Need to Know
In the world of home insurance, homeowner experiences with policy adjustments and provider changes are quite common. Recently, a homeowner in North Carolina received a notice from Connect by American Family about a significant change: the company is consolidating and offering a new policy underwritten by Homesite Insurance Company of the Midwest. This scenario prompts an important question—should you be concerned about such changes?
What’s happening?
Many property owners have experienced policy updates, often starting with initial providers like AMEX or other carriers, then transitioning through several companies over the years. Usually, these changes come with notices explaining that your coverage continues seamlessly, with only minor adjustments—often related to payment methods or administrative details.
This time, however, the notice indicates that Connect is consolidating operations and offering a replacement policy. While this might seem alarming, it’s not necessarily a negative development. Insurance companies frequently rebrand, restructure, or exit certain markets due to strategic decisions or regulatory reasons.
Should You Be Worried?
In most cases, these shifts are standard industry practices. It’s worth verifying:
- Is your new underwriter, Homesite Insurance, reputable and financially stable?
- Will your coverage terms, deductibles, and premiums remain comparable?
- Are there any specific restrictions or exclusions that differ from your previous policy?
Insurance pricing has also been on the rise, with premiums potentially increasing significantly—sometimes by hundreds of dollars annually. In this situation, premiums increased by over $700, from $2,600 to $3,300—a noteworthy jump that homeowners should examine closely.
Understanding Your Credit Rating Impact
Interestingly, insurers often assess your risk profile based on credit history. Factors such as the age of your credit accounts and the number of revolving accounts can influence your premium calculations. Some common considerations include:
- The age of your most recent revolving account—more than a year old is typically seen as a positive indicator.
- Number of open revolving accounts—generally, fewer accounts are preferred, but keeping unused cards open can impact your credit score.
- The average age of your accounts—older accounts are usually viewed more favorably.
In the case shared, a homeowner observed that their credit profile included accounts opened 4-5 years ago, multiple active accounts, and an average account age below 10 years, which might negatively influence their premium costs.
Final Thoughts
While insurance policy changes can seem daunting, they are often part of broader industry trends. Home
