Cancellation Versus Non Renewal

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What is cancellation versus non renewal?

Cancellation Versus Non Renewal

When shopping for an online homeowners insurance quote, it is important to understand the difference between cancellation and non-renewal of a policy to assure you get the best rates. While the end result is the same—the homeowner is not insured—the reasons and results on future premiums can be very different.

  • Cancellation. After 60 days, an insurance policy can only be cancelled due to non-payment of the premium or serious misrepresentation of information on the insurance application. Cancellation of a policy typically is due to an error, fraud or other homeowner-controlled action such as failure to pay.
  • Non-Renewal. Unlike cancellation, non-renewal may not be under the control of the homeowner whatsoever. For example, the insurance company may decide to stop writing policies or reduce the number of existing policies in an area when it could lead to large claims or risk exposure. On the other hand, an underwriter may also decide not to renew a policy due to items under the control of the homeowner. Common reasons for non-renewal may include:
    • Failure to properly repair and/or maintain the property
    • Acquiring a violent pet
    • Excessive claim history



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