At E. R. Munro and Company, we try to point out to anyone who will listen that there is a real difference between insurance companies, and it is not just the price of the policy. A front-page investigation in The Wall Street Journal has now put hard numbers behind something we have been telling our clients for years.
According to that Wall Street Journal analysis, nearly half of homeowners insurance claims now result in zero payout. The article — fittingly titled “The Home-Insurance Coin Flip” — examined the nation’s largest carriers and tracked how often they closed claims without paying anything over a roughly nine-year period.
This is exactly why we say: insurance is a contract, not a commodity. The lowest premium can quietly become the most expensive decision you ever make.
Not All Insurers Are the Same
One of the most striking parts of the WSJ report was a chart showing the ten top insurers and the percentage of claims each declined to pay. The differences between carriers were significant and revealing.
Some companies paid nothing on a strikingly high share of resolved claims. The Journal noted, for example, that one Florida-focused carrier paid nothing on roughly half the claims it resolved in a recent year, up sharply from about 26% just a few years earlier. That kind of jump shows how quickly a carrier’s claims behavior can change.
By contrast, the two companies near the bottom of that list — Nationwide and Travelers — had the fewest claims rejected. We are proud to represent both. We do not criticize our competitors; instead, we simply point out that we choose to work with companies that have a strong track record of paying claims. You will also notice that Chubb, a premier insurer known for high-value homes and exceptional claims service, did not appear on the mass-market chart at all.
The takeaway is simple: two policies can look nearly identical on paper and cost about the same, yet perform very differently when disaster strikes.
To Be Fair — Sometimes a “No” Is in the Contract
The Journal article is fair, and so are we. A claim that closes with no payment does not always mean an insurer behaved badly. Often, the answer lies in the policy contract itself.
Here are the most common reasons a legitimate claim still results in zero payout.
1. Rising Deductibles
Deductibles have climbed dramatically. A $2,500 deductible is not uncommon today, and in storm-prone regions, many carriers now use percentage-based deductibles for wind, hail, and hurricanes — often 1% to 5% of the home’s insured value.
On a $400,000 home, a 2% wind deductible equals $8,000. So, a $6,000 storm-damage claim may be paid out at exactly nothing, even though the damage is genuine.
2. Flood Damage Is Not Covered
Many homeowners are shocked to learn that standard homeowners insurance does not cover flood damage — including rising water, storm surge, and overflowing creeks or rivers. This is true even outside high-risk flood zones.
Flood protection requires a separate flood policy, available through the National Flood Insurance Program (NFIP) or private flood insurers. Without one, a homeowner can be left paying for foundation, flooring, and structural repairs entirely out of pocket.
3. Reasons That Aren’t Obvious — Until You Read the Contract
Sometimes a denial isn’t apparent to the homeowner, who understandably concludes the insurance company is “a cheap, chiseling, no-good dirtbag.” That can be true. But the honest question we ask is: you picked that company — did you look at anything other than the price?
Just because you have been paying “Quicksand Mutual Insurance Company” faithfully for all these years does not guarantee your claim will be paid. The homeowner’s policy is a legal contract, with specific exclusions written right into it.
The Fine Print Most People Never Read
Let’s be honest, most people don’t read their insurance contract until the moment of a claim. After all, why would you, unless you were looking to cure your insomnia? Unfortunately, that is the worst possible time to discover what isn’t covered.
Here are exclusions and limits that catch homeowners off guard most often:
Wear and Tear. The standard homeowner’s contract specifically excludes gradual deterioration and lack of maintenance. A worn or aging roof, for instance, may be denied even after a storm if the carrier concludes the underlying damage was due to age rather than a sudden event.
Earth Movement. Earthquakes, sinkholes, and mine subsidence are excluded under standard policies. This is especially important in Pennsylvania, where many homes sit above abandoned coal mines. Separate Mine Subsidence Insurance, or MSI, is available and, for many local homeowners, essential.
Jewelry and Valuables Sub-Limits. Standard policies contain specific limits for theft of jewelry that can be as low as $1,500. So, when that $10,000 Rolex is stolen, you may only be reimbursed for $1,500, leaving you out $8,500 and feeling as though you’ve been robbed twice. Higher limits are available for an additional cost by scheduling the item on a personal property endorsement, also known as a “floater.”
A quick annual conversation with your agent can close every one of these gaps before a loss, not after.
What This Means for You
The Wall Street Journal’s findings confirm what we believe deeply: the true value of a policy is determined at the time of a claim, not at the time you pay the premium.
To protect yourself, we recommend:
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Review your policy every year with a licensed independent advisor — looking beyond price at limits, deductibles, and exclusions.
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Right-size your deductible to match the cash you could comfortably pay tomorrow, and check for separate wind, hail, or hurricane deductibles.
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Add coverage where gaps exist — flood, mine subsidence, water backup, and scheduled jewelry or valuables.
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Document your home and belongings with photos, videos, receipts, and appraisals stored digitally.
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Choose your carrier carefully — because the company behind the policy matters as much as the policy itself.
How We Can Help
As an independent, multi-carrier agency with more than 140 years of experience, we are not tied to a single insurer. We can compare carriers, explain contract differences in plain English, and match you with companies that have proven they pay claims — including Nationwide and Travelers, with access to premier insurers like Chubb.
We don’t sell the cheapest coin flip. We help you build coverage designed to perform when it matters most.
Source: This article references reporting from The Wall Street Journal, “The Home-Insurance Coin Flip: Nearly Half of Claims Result in Zero Payout,” published May 30, 2026.
