What to do if your homeowners insurance is canceled

Before canceling an insurance policy, the insurance company must notify the policyholder. Typically, an insurer can give a homeowner 45 days' notice before canceling an insurance policy if a cancellation occurs after the policy is put in place. If a homeowner is sent a notice of non-renewal or is offered a renewal, the rules are different. These differ from state to state.

If you receive a notice of an issue, you can take action to fix it. Do not delay contacting your insurance provider or agent and making any overdue payments if you have received a home insurance policy lapse letter. Reinstating your policy may necessitate notifying your mortgage lender, who normally demands proof of homeowner's insurance as part of the loan application process. For example, if you have a policy canceled, your lender may acquire a new policy on your behalf and expect you to pay for it. If the new policy is far more expensive than your current policy, you'll still be required to pay it. Unlike regular homeowners insurance policies, this is "force-placed" and does not cover any of your personal goods. In order to avoid a situation like this, you should notify your lender as soon as possible if your insurance has been reinstated. It's best to call your mortgage company as soon as possible if you've been sent a letter notifying you of a lapse in coverage and your insurance is paid through an escrow account.

If you receive a non-renewal notice, the first thing to do is to learn why your policy is being canceled. If you don't get an explanation in the mail, you may always call your carrier or agent and ask them for more information. You may be able to persuade the insurance company to preserve your coverage by making adjustments to your house or policy, depending on the circumstances.

Talking to your insurance provider or agent is a recommended first step if you receive a cancellation letter. Depending on the inspection results, you may be allowed to repair or replace your deteriorating roof if your homeowners' insurance is canceled. There's a chance that the firm will reverse the decision and reinstate your coverage.

For those who have had multiple claims or whose house is in poor condition, it may be difficult to get insurance if you cannot persuade your insurance company to preserve your policy. Check with your state's insurance department or a local insurance agency if you are having difficulty finding inexpensive home insurance following a cancellation. They may supply you with a list of insurance companies that specialize in providing coverage for homeowners in your area who are considered high-risk.