Matt, a couple of comments.

First, homeowners is a commodity and most insurance companies won't take time to modify their standard agreements to include or exclude risks. In most states, the forms have to be filed and approved in advance by the insurance departments, and companies can't just start including and excluding coverage on personal insurance at will. It is a bit different than commercial insurance, which is much more "customizable".

Next, remember that there is a $250,000 deductible that the AMA pays before the liability policy ever kicks in. If members started to try to make the AMA coverage primary, well, the dues would not stay where they are today. If we started hitting the AMA policy heavily, well, the insurance premiums would go up, or god forbid, the policy would be canceled, and dues would go up. Not a good thing.

People obviously have large claims without being canceled, and usually insurance is available from other carriers or from Fair Plans at affordable rates, even if you have had a jumbo loss. Your scenario of having one loss and not finding coverage for less than 50k a year isn't necessarily reality. Now if they think you torched the house, or you have a habit of filing a loss per year, or you lied on your insurance application, that is another matter.

You will hear a lot of tall tales about what goes on with claims, but believe me, it is a heavily regulated, heavily audited industry and pretty much everything conforms to the contracts and industry standards.