According to the department, the woman had advised her insurance agent that she would be putting her home up for sale and that it would be unoccupied while she was relocating. The home was then vandalized and Security Mutual denied the claim for damages and cancelled her policy mid-term because the home was unoccupied.

But the department said under the insurance law an insurer may not consider non-occupancy as the sole factor in issuing a mid-term cancellation, and may be considered only if it is among other factors that increase risk to a property.

The department said it directed Security Mutual to reinstate the policy, although the company was not compelled to pay the vandalism claim due to an exclusion in her policy.

The insurer was ordered to reinstate 19 other policies cancelled under similar circumstances, and Homesite was ordered to reinstate six policies for the unoccupied homes, noted the department.

The department also deemed the termination of 174 Homesite policies improper "because the homeowners failed to receive, as required by law, information about the availability of coverage through the New York Property Insurance Underwriting Association (NYPIUA)" – the state's homeowners insurer of last resort. Some termination notices also failed to include information about C-MAP, a program designed to help homeowners obtain insurance in coastal areas, the department said.

An additional 60 Homesite policy terminations were reversed, the department said, because the company terminated them before the end of the policy periods. "Under the law, homeowners policies must remain in effect for a minimum period of three years, except in certain situations, such as when consumers fail to pay premiums," according to the department.

Tom Ruane, president of Security Mutual said, "We've offered to reinstate the policies," but would not comment beyond that.

A representative from Homesite declined to comment saying the company requires a mailed in, written notice before honoring media requests for comment.