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How many claims are too many before your insurance company drops your coverage?

A viewer says his insurance company dropped his towing coverage after he made too many claims.

GREENSBORO, N.C. — Life just happens: an uninsured driver hits your vehicle, a deer jumps in front of your vehicle, your car breaks down, and needs a tow. It's why you have insurance...right?

Just recently 2 Wants To Know got this question to verify. Viewer Marlone asked, “Is it legal for an insurance company to drop parts of your auto insurance coverage for too many claims? It happened to me after making too many towing claims in one year”.

To verify this question and claim 2WTK talked to Christopher Cook with Alliance Insurance Services and the folks from the North Carolina Department of Insurance.

The folks at the NC Department of Insurance confirmed: The only coverage an insurance company is required to offer every driver is liability.

Other kinds of policy add-ons, like towing, can be dropped at renewal time. Christopher Cook explains why it's allowed. 

“What companies can deny and often do is what you call full coverage or comp and collision, physical damage coverage. Companies do not have to write risk they see as too high of a risk”.

Specifically, when it comes to towing policies, Cook says too many claims in a year could lead to lost coverage.

“In this instance, towing costs about $6 a year per car so if the insurance company has collected $6 but they've paid out approximately $700 in towing claims, sounds like they've made a decision, for this particular customer we don’t need to offer towing,” said Cook.

We can verify, it is legal for an insurance company to drop parts of your auto insurance coverage for too many claims.

By the way, if your company is going to drop parts of your coverage, the state requires the company to mail that information to the address they have on file for you.  Make sure your information is up to date.