Why Honesty Matters in Your Insurance Application
Filling out an insurance application might seem like a routine task, but one small mistake or omission can have devastating financial consequences down the road. Many homeowners and business owners don’t realize that providing incorrect or incomplete information can result in their entire insurance policy being voided when they need it most.
At Panther Public Adjusting, we’ve seen too many policyholders suffer significant losses simply because of errors in their insurance application. Let’s discuss how these mistakes happen, why they matter, and how you can protect your policy from being invalidated.
The Dangers of Signing Without Reviewing
A common scenario occurs when insurance agents pre-fill applications and send them over for a quick digital signature. While this seems convenient, it opens the door for mistakes—mistakes that could cost you your entire claim payout in the future.
Think about it: How often do you thoroughly review your policy before signing it? Many people trust their agents, assuming all the information is correct. However, even the best agents make mistakes.
Here’s an example: One of our clients recently reviewed an application prepared by their agent and found multiple inaccuracies—details about previous claims, occupancy type, and coverage limits were all incorrect. Had they not caught these errors, they might have faced a denied claim in the future.
📩 Email us at Claims@PantherPA.com to have your policy reviewed by an expert.
Common Mistakes Agents Make in Applications
Here are some common errors we see in insurance applications:
- Failing to disclose past claims – If you have ever filed a claim and your agent incorrectly marks “No” in response to this question, your policy can be voided if a future claim occurs.
- Misclassifying occupancy status – If your home is used for short-term rentals, vacation stays, or business purposes and this is not disclosed, your insurer may deny coverage when you file a claim.
- Undervaluing property replacement cost – Many policies underestimate the true replacement cost of the property, leaving policyholders underinsured when disaster strikes.
- Incorrectly reporting renovations or upgrades – Major property improvements need to be reported. Failing to do so can impact coverage.
- Not disclosing previous litigation with an insurance company – If you’ve been involved in a dispute or lawsuit against an insurer and don’t disclose it, your claim could be denied later.
- Incorrect property details – Providing inaccurate information about square footage, roofing material, or plumbing updates can also lead to policy issues.
- Misspelling names or addresses – Even small clerical errors can lead to complications when you file a claim.
Real-Life Example: Past Claims Not Disclosed
One of our clients recently suffered a total loss due to a house fire. When they filed their claim, the insurance company discovered they had filed a claim years earlier that was not disclosed on their application. Because of this, the insurer declared their policy void, leaving them with no payout at all.
Luckily, with our team of public adjusters and attorneys, we were able to negotiate a settlement—but it was still far less than what they would have received if the error hadn’t existed.
Another client faced a denied claim after a hurricane because their home was listed as owner-occupied, but in reality, it was rented out on Airbnb. The insurer used this discrepancy to deny coverage for hurricane damage. Had they updated their policy, they would have been fully covered.
Don’t risk it—double-check your application before signing.
📞 Call us now at 833-726-8437 for a free consultation on your policy.
What Happens if Your Policy Is Voided?
When an insurer finds misrepresented information in your application, they have the right to:
- Void your policy completely (meaning they owe you nothing for your claim).
- Refund your premium payments and cancel coverage retroactively.
- Deny your claim payout entirely, even if you’ve been paying premiums for years.
The scariest part? This can happen years after your policy is issued, leaving you in a financial disaster when you need coverage the most.
Other Common Mistakes: Short-Term Rentals & Policy Exclusions
Another common issue occurs when homeowners rent out their property on short-term rental platforms like Airbnb or Vrbo without notifying their insurance provider. Many standard home insurance policies exclude coverage for short-term rentals, meaning any damage that occurs may not be covered at all.
If you plan to rent out your home, you must ensure your policy reflects that use. Learn more about how to protect your investment with the right coverage in our guide: Insurance for Short-Term Rentals
How to Avoid These Costly Errors
To ensure you are fully protected:
- Review your application before signing. Don’t assume everything is correct.
- Ask your agent questions. If something looks incorrect or unclear, get clarification.
- Keep records of past claims and disclosures. This will help prevent discrepancies.
- Be honest and upfront. If you use your home for rentals, business, or have previous claims, disclose it.
- Double-check details like names, addresses, and property descriptions.
- Work with a public adjuster. If you have concerns about your coverage, let a professional review your policy.
- Regularly update your policy—especially if you renovate, change tenants, or modify how you use your property.
🔍 Find out how policy changes impact your coverage: What Happens to My Policy When I File a Claim?
Additional Resources to Protect Your Policy
- Learn how What’s In My Home Insurance Policy? affects your coverage.
- Discover the Pros of Using a Public Adjuster and why it’s essential.
- Ensure your Hurricane Preparedness plan includes reviewing your insurance.
- Avoid policy pitfalls with Avoid This Common Insurance Check Trap! Your Money Could Be at Risk!
Final Thoughts: Protect Your Policy & Your Property
Your insurance application is a legal document, and any incorrect information—even if unintentional—can cost you your entire claim payout. Don’t let a simple oversight put your home or business at risk.
At Panther Public Adjusting, we help homeowners and business owners navigate their insurance policies, ensuring they have the right coverage before disaster strikes.
📞 Call us today at 833-726-8437 for a free consultation.
📩 Submit your policy for review at Claims@PantherPA.com to make sure you’re fully protected.
Your insurance should protect you—not work against you. Let Panther Public Adjusting ensure your coverage is solid!