NEMT Insurance Denied? Why Insurers Say No and How to Get Covered in 2027

A declined application is an underwriting decision about one file at one insurer. Most of what drives it can be changed. When it cannot, state law gives you other places to buy coverage, and this guide walks through them in the order you use them.

Why insurers turn down NEMT companies

NEMT is a hard account to place. The broker MTM Health wrote on January 9, 2024 that several carriers had left the NEMT insurance market entirely and that the ones still writing it had raised rates. Washington’s Medicaid agency told its legislature on December 1, 2024 that the cost of insurance, along with low or inconsistent trip volume, was the biggest barrier to expanding its stretcher van pilot.

State regulators spell out what makes an account hard to place. The California Department of Insurance’s commercial insurance guide (revised June 14, 2024) says a business may not find coverage in the standard market if it has had significant losses, does high-risk work with a greater chance of frequent or severe claims, or started recently. The Maryland Insurance Administration’s guide (July 2024) adds that driving records, claims history, and a lapse in coverage can each keep you from getting insured.

Reason	What the underwriter sees	What you can change
A new business	No claims history of your own to price	Send a complete file: owner and driver experience, written procedures, and the contracts you hold
Driver records	Violations or crashes outside its driver rules. Maryland warns that your employees’ records can keep you from the insurer you want.	Pull every driver’s record before hiring, and keep flagged drivers off the schedule
Past claims	How often you had claims and how large they were	Loss runs from every past insurer, with what you changed after each claim
A lapse in coverage	Maryland says some insurers will not insure a vehicle that went uninsured while you owned it	Keep the old policy until the new one starts
Vehicles	Seating, lifts, stretchers, and age	Quote the exact van before you buy it
Where and how you run	Garaging address, service area, and the riders you carry	Give accurate garaging and radius, and list your trip types

Seating changes the whole file. A vehicle designed for 16 or more people, driver included, is a commercial motor vehicle that needs a CDL (49 CFR 383.5). On for-hire interstate trips, a vehicle seating 16 or more needs $5 million in liability coverage, against $1.5 million for one seating 15 or fewer (49 CFR 387.33T). For how each factor moves your price once you are insured, see NEMT insurance cost.

One insurer’s no says little about the next one’s, because each insurer sets its own rules. The California guide notes that any one agent may represent a limited number of insurers, so it is normal to ask several agents for quotes.

First, find out exactly what happened

A declined application, a nonrenewal, and a cancellation are different events, and your rights differ.

A new application was declined. Ask your agent to get the underwriter’s reason in writing, along with the declination itself. Keep every one. Later steps can require them: California’s surplus lines rule and Florida’s workers’ comp plan both count written declinations.

Your current insurer will not renew. State law usually sets the notice and requires a reason. Here is how five states handle commercial policies as of September 2026:

State	Nonrenewal notice	Must it give the reason?	Also worth knowing
California	60 to 120 days before the policy ends (Insurance Code 678.1)	Yes	If the notice is late, the policy continues unchanged for 60 days after it is given
Florida	At least 45 days (627.4133)	Yes	Cancelling a commercial auto policy takes at least 45 days’ notice, or 10 days when the reason is nonpayment (627.7281)
New York	60 to 120 days (Insurance Law 3426)	Yes, the specific reason	If the notice is late but before expiration, coverage continues on the old terms until 60 days after it is sent
Pennsylvania	At least 60 days (Act 86 of 1986)	Yes, with enough detail for you to correct the problem	Ask within 10 days and the insurer has 30 days to send at least three years of loss information
Texas	At least 60 days (Texas Department of Insurance)	Yes	If the notice is late, the policy stays active 61 days after notice. After 60 days in force, the insurer can cancel only for listed reasons such as fraud or nonpayment.

These notice laws are written for policies from licensed insurers. California’s does not apply to surplus lines policies (Insurance Code 675.5), and New York’s does not apply to excess line policies, its term for them, so read the notice terms of any surplus lines policy you buy.

Pennsylvania’s standard is the one to ask for everywhere: the reason should tell you what to fix. Start shopping the day a nonrenewal notice arrives, and tell your brokers. Paratransit Services, a Washington Medicaid broker, requires its transportation subcontractors to report a cancellation or nonrenewal notice in writing within one business day (its posted requirements as of September 2026).

Build the file the next underwriter will ask for

A second application goes better when it answers the first insurer’s concern before anyone asks. Build one package and send the same one to every agent.

Loss runs from every insurer

A loss run is your claims history with one insurer: each policy, each claim, and what was paid. Ask each insurer from the last five years in writing. Several states set deadlines:

State	Deadline after your request	What it covers
Florida	15 calendar days after a written request (627.444)	Your last 5 years with that insurer. One statement a year is free.
Oregon	15 calendar days (OAR 836-080-0810)	5 years, or your whole time with that insurer if shorter
Illinois	30 days (215 ILCS 5/143.10a)	The 3 previous policy years. The insurer also sends it with any cancellation or nonrenewal notice, except for nonpayment, misrepresentation, or fraud.
Pennsylvania	30 days, if you ask within 10 days of a nonrenewal or midterm cancellation notice (Act 86)	At least 3 years, or your whole time with that insurer if shorter

A brand-new company has no loss runs of its own. Say so plainly on the application.

Driver records

Pull a motor vehicle record for every driver, including yourself. MTM Health’s standard agreement already requires one covering the previous three years, renewed every year. If one driver’s record is what the underwriter flagged, ask whether the account can be written without that driver, and keep that driver off trips until it is. The driver background check guide covers the rest of the screening.

Vehicle list

List each van with its VIN, year, make, model, seating, garaging address, and any lift, ramp, or stretcher equipment. The Maryland guide suggests adding coverage for permanently attached items, so ask your agent how the policy treats a lift or ramp.

Written safety procedures

The NAIC says businesses with solid, documented safety practices may be seen as lower risk and charged lower premiums. Put yours on paper and attach them:

• Driver hiring standards, including the driving record you accept.
• Training records for defensive driving, passenger assistance (PASS), and wheelchair securement.
• A pre-trip inspection routine and a vehicle maintenance log.
• An incident report form and who reviews each report.
• Cameras or tracking, if you use them. See NEMT dash cameras.

Your contracts’ insurance rules

Give each agent the insurance section of every broker and facility contract you hold or plan to sign. MTM Health’s standard agreement (January 1, 2023 copy) asks for a $500,000 combined single limit on auto liability, $500,000 per occurrence in general liability, MTM as additional insured, and endorsements that give MTM notice of cancellation. Some brokers also set a floor on the insurer’s rating: Paratransit Services accepts admitted insurers rated B++, Class VII or better by AM Best and surplus lines insurers rated A-, Class VII or better. The NEMT insurance requirements guide lists what other states and brokers require.

Tell the truth on every form

Answer every question on the application, including any about past declinations and cancellations. In Florida, a misrepresentation or omission that is material to the risk can prevent recovery under the policy (627.409). Maryland treats a knowingly false statement on an insurance application as a fraudulent insurance act.

Where coverage comes from after a no

Work through these in order. Each step usually needs proof that the one before it did not work.

1. More licensed insurers, through more agents

Ask two or three commercial agents who place transportation risks to market your file. Check each agent’s license with your state insurance department before you share documents. In Texas, the Department of Insurance Help Line at 800-252-3439 confirms whether a company can legally sell insurance there.

2. Surplus lines insurers

A surplus lines insurer is not licensed in your state but is allowed to cover risks licensed insurers will not take. In California, you reach one only through a broker who holds a surplus line license from the state. The protection is thinner: in California, Florida, and Texas, surplus lines policies are outside the state guaranty fund that pays claims when an insurer fails.

State	Before a surplus lines policy	What else to know
California	Three turned-down applications from licensed insurers, with written documentation (Department of Insurance guide)	Check that the insurer is on the state’s List of Approved Surplus Line Insurers. You sign a disclosure notice saying the policy comes from a surplus line insurer (Insurance Code 1764.1).
New York	The broker swears that after a diligent effort the coverage could not be bought from authorized insurers. Three declinations is the number the law sets (Insurance Law 2118).	The broker lists each declining insurer’s name, declination date, and NAIC code
Florida	You sign an acknowledgment that coverage may be available from licensed insurers (626.916). Since July 1, 2025, there is no longer a rule of three documented rejections (chapter 2025-145).	The rate cannot be lower than most licensed insurers charge for the same risk, and any agent fee must be itemized before you buy
Texas	The agent must first try to find a Texas-licensed insurer	The Department of Insurance says surplus lines insurers do not sell auto liability in Texas

Before you bind, check the insurer against your broker’s rules, such as the A- rating floor above.

3. Your state’s auto insurance plan

When licensed insurers will not write your auto liability, several states run a plan of last resort for applicants the regular market turns down. You apply through an insurance agent, so ask if yours is certified or appointed for the plan.

State	Plan	What it offers, as of September 2026
Texas	Texas Automobile Insurance Plan Association (TAIPA), 866-321-9154	Only the state minimum limits, 30/60/25, and no physical damage coverage. You must have been turned down by two insurers in the last 60 days. The Department of Insurance calls it the only option if no licensed insurer will sell you auto liability. Commercial rates rise 4.9 percent overall for new and renewal policies starting November 1, 2026.
Maryland	Maryland Automobile Insurance Fund (Maryland Auto), 800-492-7120	Auto liability for Maryland business owners who cannot get commercial auto insurance in the private market (Maryland Insurance Administration, July 2024). Its commercial page lists combined single limits of $500,000, $750,000, and $1 million for eligible vehicles.
Louisiana	Louisiana Automobile Insurance Plan	A residual market for private and commercial vehicles. Its commercial procedure can appoint servicing carriers to issue policies (R.S. 22:1475).
Delaware	Delaware Automobile Insurance Plan	Private passenger or commercial policies for applicants declined in the voluntary market, through an agent
Massachusetts	Commonwealth Automobile Reinsurers	Commercial liability and physical damage coverage for applicants the voluntary market will not take. Its manual has a public transportation section for vehicles used as public livery (effective March 1, 2026), placed through appointed Exclusive Representative Producers.

A plan that keeps your van legal on the road can still fall short of a broker contract. TAIPA sells only the Texas minimum of $30,000 per person, $60,000 per accident, and $25,000 for property damage (Department of Insurance, December 2025), while MTM Health’s standard agreement asks for a $500,000 combined single limit. In other states, ask the plan agent for its highest limit and the endorsements it can add, then send that to your broker’s credentialing team before you apply.

4. Workers’ comp when no one will write it

Workers’ comp has its own markets of last resort. Here is where to go in six states:

State	Where to go
Texas	Texas Mutual Insurance Company, created by the legislature in 1991 as a last resort for employers who cannot find coverage. 800-859-5995 (Department of Insurance, November 2024).
Florida	Florida Workers’ Compensation Joint Underwriting Association. Eligibility includes documented rejection by at least two insurers, and applications that arrive 45 days before the start date go through its market assistance plan, which helps place employers with insurers (627.311).
Maryland	Chesapeake Employers Insurance Company, 800-264-4943, which may be able to cover you when the private market will not (Maryland Insurance Administration, July 2024)
Georgia	The Assigned Risk Plan, administered by NCCI, 1-800-622-4123. Georgia has no state fund.
Mississippi	The Workers Compensation Assigned Risk Pool, listed by the state insurance department as a market of last resort
Washington	The L&I state fund only, unless you are a certified self-insured employer. Private workers’ comp is not allowed.

Workers’ comp for NEMT explains when you must carry it and how it is priced.

Mistakes that turn one no into several

• Running trips while you are uninsured. MTM Health’s standard agreement requires insurance at all times and ends immediately if you fail to keep it.
• Letting the old policy end before the new one starts. Maryland’s regulator says a lapse can raise your next premium and lead some insurers to refuse you.
• Leaving a driver, a van, or a claim off the application. It can cost you the claim payment later, as Florida’s statute shows.
• Moving broker trips onto a personal auto policy. Maryland’s guide warns that many personal policies exclude business liability claims. See using your own vehicle for NEMT and livery vehicle.
• Buying the van before you have a quote on it. Maryland’s guide says premiums are linked to the type of vehicle, so check the insurance rate before you choose.

From declined to covered, step by step

1. Get the reason and the declination in writing from your agent.
2. Order loss runs from every insurer of the last five years, in writing.
3. Pull a fresh driving record for every driver, and decide what to do about any record the underwriter flagged.
4. Fix the named problem and write down what you changed: a driver taken off the schedule, a new procedure, a different vehicle.
5. Collect the insurance section of every broker and facility contract you hold or want.
6. Apply through two or three licensed agents with one complete package.
7. Keep every written declination. You may need them for surplus lines or a state plan.
8. If licensed insurers all decline, ask about surplus lines, and about your state’s auto plan for auto liability.
9. Arrange workers’ comp through your state’s last resort if the private market will not write it.
10. Before you bind, have each broker confirm the quote meets its limits, endorsements, and rating rules.
11. Bind, then send certificates of insurance and finish broker credentialing before your first trip.
12. Build a clean record and shop again at renewal. California’s guide notes that premiums come down as your loss experience improves.

Start this well before you need coverage. Loss runs, underwriting, and a state plan’s review each add time, and brokers want your certificates at signing: MTM Health’s agreement asks for them when you sign and at every renewal. If you are still setting up the company, fit these steps into your startup plan, and if you plan to run stretcher vans, read how to start a stretcher transportation business first.