What Should You Do If Your Home Insurance Is Canceled or Not Renewed?
What Is the Difference Between Cancellation and Nonrenewal?
Shanti
8/18/20263 min read
What Should You Do If Your Home Insurance Is Canceled or Not Renewed?
Receiving a letter from your insurance company with the word Cancellation or Nonrenewal can be concerning. However, these two terms do not mean the same thing. If your home insurance has been canceled or your company has decided not to renew it, it is important to understand the difference and obtain a new policy before your current coverage ends.
What Is the Difference Between Cancellation and Nonrenewal?
Nonrenewal means that the insurance company will not continue your policy after the current policy period ends. You can find the expiration date on the declarations page of your policy or on your renewal notice.
According to the Texas Department of Insurance, the insurance company must notify you before it decides not to renew your policy. If your policy is not renewed on or after January 1, 2026, the company must provide a written explanation of the reason for its decision.
Cancellation means that the insurance company ends your coverage before the policy expiration date. In Texas, the company generally must notify you at least 10 days before canceling your policy.
You also have the right to cancel your policy before the end of the policy period. However, you should not cancel your existing coverage until your new policy has become active.
Why Might an Insurance Company Refuse to Renew Your Home Insurance?
Insurance companies review the condition of the property, its claims history, and the level of risk in the area when considering a policy for renewal. Common reasons for nonrenewal may include the following:
• The condition of the home has deteriorated since the policy was issued.
• The roof, electrical system, plumbing, or other parts of the home need repairs.
• Three or more claims unrelated to weather have been filed within three years. These may include fire, burst pipes, or damage caused by rodents.
• The home has been vacant for 60 days or longer.
• The insurance company has decided to reduce the number of policies it offers in your area.
• Risks associated with the area, weather conditions, or rebuilding costs have increased.
In some cases, the insurance company may give the homeowner time to complete certain repairs. For example, the company may allow six months to repair the roof or other parts of the property. If the required repairs are not completed, the policy may not be renewed.
Why Might a Policy Be Canceled Before Its Expiration Date?
An insurance company may cancel a policy before its expiration date for the following reasons:
• The premium is not paid by the due date.
• Incorrect or important information was omitted or misrepresented when applying for coverage.
• A fraudulent claim was filed.
• A change was made to the home that significantly increased the risk of insuring it.
What Should You Do If Your Home Insurance Is Canceled or Not Renewed?
Read the Notice Carefully
Review the date your coverage will end, the reason for the company’s decision, and any requirements for correcting the problem. If the reason is unclear, ask the insurance company to provide a written explanation.
Begin Shopping for New Insurance Immediately
Do not wait until the final days of your policy. Reviewing the condition of the home, completing a possible inspection, obtaining quotes, and receiving approval for a new policy may take time.
Avoid a Gap in Coverage
Your new policy should begin no later than the day your existing coverage ends. Even a short gap may leave your home unprotected and could make obtaining insurance in the future more difficult or expensive.
If you have a mortgage, the lender generally requires you to maintain valid homeowners insurance. If your coverage ends, the lender may purchase Force Placed Insurance for the property. This type of insurance is usually more expensive and primarily protects the lender’s financial interest rather than the homeowner.
Correct the Reason for Nonrenewal Whenever Possible
If the issue involves the roof, nearby trees, plumbing, electrical system, or other repairs, ask what corrective work is required. Keep photographs, receipts, and documents showing that the repairs were completed because the new insurance company may request them.
Do not compare policies based only on the premium. You should also review the following:
• The amount of dwelling coverage
• The deductible for wind and hail damage
• The deductible for other types of claims
• Whether roof damage is covered based on replacement cost or depreciated value
• Water damage coverage
• Restrictions based on the age of the roof
• Additional living expense coverage
• Policy exclusions and limitations
The least expensive policy is not always the best choice.
What Happens If No Insurance Company Will Insure the Home?
If at least two insurance companies refuse to insure your home, you may qualify for coverage through the Texas FAIR Plan Association. This program serves as an option of last resort for certain properties that cannot obtain coverage through the standard insurance market.
The coverage and conditions offered by the FAIR Plan may differ from those of a standard homeowners insurance policy. For this reason, you should carefully review all coverage details before purchasing the policy.
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