Michigan homeowners insurance is regulated by the Michigan Office of Financial and Insurance Regulation. This government entity ensures that the laws of the state are met by both the insured and the carrier. Michigan law is designed to ensure nearly every home is eligible for coverage.
The law states that you cannot be denied insurance on your home based on the age of the home, it’s location or neighborhood in which the home stands. Furthermore Michigan law states that a resident of the state is not required that a home and auto policy be written by the same company, although many companies like this, offer discounts if you do use their services for multiple types of insurance, commonly called bundling.
There are a few reasons why a homeowner can be denied insurance including having arson violations, two-years or more of delinquent property taxes, non-payment of previous policies, if the home is being used for dangerous or illegal purposes, the home presents a significant likelihood of loss, refusal to join certain groups, clubs or organizations required by the insurance company and refusal to purchase the bare minimum required amount of insurance. This last one is to prevent people from underinsuring their homes and later filing a lawsuit against the insurance company.
As with most homeowners insurance policies you can get replacement, or repair policies. The difference is repair policies will pay fair market value to repair the home using modern materials whereas the replacement policy covers the repair of items using the same materials that were lost so if you had a roof lost in a storm, the insurance company will use the same type or material or as close as possible to it in order to repair it, whereas in a repair policy you can replace the roof with modern materials that are commonly used.
Michigan homeowners insurance requirements include the minimum amount of insurance to purchase either a repair or replacement policy. A law was enacted on July 1, 2008 that requires a home to be worth at least $15,000 to purchase a repair policy and $35,000 to purchase a replacement policy. Anything that falls below this amount is not eligible for insurance in the State of Michigan.
Homeowners insurance is not required by Michigan law but mortgage lenders require you to have this coverage to protect their investment. Michigan also makes it possible for you to purchase renters and condominium insurance. Contacting the Michigan Office of Financial and Insurance regulation can answer any question you may have regarding Michigan homeowners insurance.