Pay your insurance bills on time and click on the send button!Donald Light is one of the smartest -- and busiest -- people I know. But even this longtime Celent Research Services insurance consultant makes mistakes. Light was so busy minding other people's insurance needs this year that he didn't keep track of his own.

His story came to light when he admitted in an online mea culpa, titled "Why Billing Matters," that his homeowners insurance policy had been cancelled. So for all of us who've lived through the nightmare of cancelled insurance policies, here's the unmistakable message: Insurance companies don't care.

Slip and fall

Here's how it happened. Light's homeowners policy ends each year on Oct. 8. When Light got the bill in August from his insurer, he thought he had paid it online. But when he returned home from a trip on Oct. 21, Light found out that his insurance policy had been cancelled as of Oct. 8 due to "non-payment."

"Looking at the letter telling me that my single largest investment had been uninsured for the past two weeks was horrible," he admits. "If someone had slipped and fallen in front of my house, I would have been out a lot of money."

During the time between the initial bill and the expiration notice, Light said that he received the following communications from his insurer:" "zilch, nada, rein." All different ways to say "nothing."

Insurance analyst or deadbeat

What's more, Light has a big mortgage on his home. So while the insurer did not notify him until after his policy was cancelled, it immediately informed the bank that carries his mortgage.

And the bank wasn't happy. Instead, it was ready to buy its own insurance policy for Light's home, which probably would have cost twice as much as the one Light thought he had. Light now had to endure not only the paperwork nightmare of having his own insurance reinstated, but also getting his bank to back off and accept the fact that this insurance analyst wasn't an insurance deadbeat.

Get a 'tickler'

Light admits to being somewhat at fault. "I recorded the check to the insurer in my file," he says, "but I probably just forgot to click on the send button."

Should he have double checked to see if the check was cashed? Probably. But the reality is that many people have multiple insurance policies, including, auto, home, health and life, and if you're an independent contractor like me, there's even more to remember. Since insurance policies usually have different renewal dates, Light recommends that you set up a "tickler" file to help you remember. But he had one and it still didn't help.

Unconcerned about cancellations

So what is the insurance company's responsibility? It only has to send you a renewal notice with a bill. But wouldn't an insurer, even Light's, want to retain customers such as Light who has a large policy and pays his bills on time? Why not send a follow-up "last chance to pay" notice? Surely someone in the corporate office is concerned about customer service.

Yet consumers' concerns about cancellations or nonrenewals are ranked No. 2, right after not paying claims, on some state regulator's websites. Insurers are heavily regulated when it comes to canceling policies due to bad driving or burning down your house. But forgetfulness on the customer's part is not addressed.

Don't assume your agent will call you

Maybe you think you should get an independent insurance agent who could remind you when your premiums are due. But that still isn't foolproof. If an independent agent notifies most of his customers of late payments, but misses the one who suffers damage, he or she could face a lawsuit for negligence, says Josh Heebner, an independent agent in the Philadelphia area.

Some brokers will avoid the potential legal hassle by not notifying anyone. Here's more about why your agent won't tell you your policy is being canceled.

The moral of the story: Pay your bills on time and click on the send button!