Insurance companies often issue property insurance policies without inspecting the property beforehand and then inspect shortly after. This is especially common in commercial properties. These inspections are designed to help identify and reduce risks, and insurance companies will often demand that the insured make the repairs recommended by the inspector to keep the policy in force. When repairs are not made to the satisfaction of the insurer, the insurer might threaten to cancel the policy. During this period there is a significant risk of the insured undergoing brief periods of being uninsured which may result in an uncovered loss. Even if such a loss does not occur, the interruption of coverage may substantially affect a commercial business and cause severe stress.s
California has strict laws on when a policy can be canceled and on what basis, as well as on what the insurance company can demand. It is important to evaluate the insurer’s inspection report and demands to prevent an uncovered loss before even considering complying with them, as the demands may be illegal. If a claim is denied because of an uninsured period after the inspection, it is vital to investigate whether the insurance company had the right to cancel coverage for that period. Ivo Labar and Dan Veroff have helped expand the protections of this law in California.