Receiving a non-renewal notice from your home insurance company can be an unpleasant surprise. Your insurer can choose not to renew your policy for various reasons, including frequent claims or diminished property conditions.
Understanding why non-renewals happen and how to find a new policy afterward is the best way to maintain consistent and affordable coverage.
Here’s what you need to know to secure a new home insurance policy.
Your insurance company can end your home insurance policy in two different ways — the insurer can cancel it or opt for a non-renewal. A cancellation occurs when your insurer ends your policy before the term limit is up, and a non-renewal is when you or your insurer chooses not to renew your coverage.
Once your insurance policy is in place for more than 60 days, your insurance company can’t cancel your coverage in most cases. Insurers can cancel your policy only if you stop paying your premiums or deliberately misrepresent yourself in your application.2
In comparison, a non-renewal occurs when your insurer decides not to renew your policy after it expires. In most states, your insurer must notify you of the non-renewal before your policy has expired, though the length of time depends on where you live. For example, Colorado law states insurers must provide 60 days’ notice.3
If you receive a non-renewal notice, you’ll need to start shopping around for a new home insurance company. If you want to contest the decision, contact the company’s consumer affairs division or your state’s insurance department.
Learning your home insurance company is choosing not to renew your policy can come as a shock. Here are the steps you should take after receiving a non-renewal notice:
Read through the notice so you understand when your policy will end.
Contact your insurance company for clarification and more information.
Request a written explanation of the non-renewal.
Review your current policy and claims history.
Ask your insurer if you can address any issues and reverse the non-renewal.
Begin shopping around for a new policy.
You can appeal the non-renewal if you feel the insurance company’s decision is unfair. In some cases, your insurer may be willing to reverse the decision and renew your policy. If your appeal is unsuccessful, you can also reach out to your state’s insurance department.
If your insurance company decides not to renew your policy, it must provide you with a written explanation. Once you understand the reasoning behind the non-renewal, you can take steps to improve your odds of approval with another insurer.
Here are five common reasons for home insurance non-renewals:
If your insurer informs you they won’t renew your home insurance, it’s important to take immediate steps to find a new policy.
You can take the following actions to secure more affordable home insurance:
Shop around and compare quotes. The best way to find a new policy that meets your needs is by shopping around and comparing quotes from different insurers. An online comparison site can make this easier since you’ll apply once and receive multiple offers.
Consider working with an insurance broker. Insurance brokers are state-licensed professionals who act as middlemen when purchasing insurance. Insurance agents work for one company, but brokers work with many different insurers. Brokers can research various policies and bring the best options to you.
Look into state-sponsored or high-risk insurance pools. If you’re struggling to find insurance, you may want to purchase coverage through your state’s Fair Access to Insurance Requirements (FAIR) Plan. Most states offer a FAIR Plan or something similar. These plans offer a basic level of protection to all consumers.
Be honest about your insurance history. When you’re looking for a new policy, it’s important to be honest about your previous insurer’s decision not to renew your policy. Trying to hide this fact will only reflect poorly on you when the insurance company finds out.
Improving your home’s insurability will help you find the best rates and home insurance coverage. Here are a few ways to improve your home’s insurability:
Conduct necessary repairs and maintenance. Conduct regular maintenance on the roof, electrical systems, and HVAC. Take care of necessary repairs as they arise so the problems don’t get worse.
Install safety and security features. Installing safety features, like a security system or sprinkler system, could reduce the risk of theft. A safer home is less risky to your insurance company, so you may qualify for better rates or even a discount.
Reduce potential hazards around the home. Safeguard your home against the most common risks. For example, make sure you have easy-to-access fire extinguishers. If you live in an area subject to severe weather, you might consider installing storm doors or a sump pump.
Review your coverage regularly. Review your coverage at least once a year to account for any changes to your property. For example, home improvements could increase your home’s value.
If you have additional questions about non-renewal notices, the following information may clear things up for you.
Yes. You can ask your insurance company to reconsider its decision. If you feel the specific reason behind the non-renewal is unfair, you can appeal it with the company’s consumer affairs division. If that doesn’t get you anywhere, you can also contact your state’s insurance department.
No. A cancellation means your insurer is canceling the policy before the term is up. A non-renewal means your insurance company won’t renew your policy after it expires.
The amount of notice you receive depends on your state’s laws. For example, in New York, insurance companies must give you between 45 and 60 days’ notice.
How it affects your future insurance rates depends on the reason behind the non-renewal. For example, let’s say your insurer chose not to renew your policy because you filed an excessive number of claims. If those claims are still on your CLUE report, other insurance companies will likely see you as high-risk and charge higher rates to accommodate for that risk.
If you have a mortgage, your loan servicer requires you to carry homeowners insurance. If you can’t find a policy on your own, your insurer will find one for you. Lender-placed insurance is a policy placed by a bank or mortgage servicer when the homeowner has insufficient or lapsed coverage.
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3+ years experience in insurance and personal finance editing
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