If you own a home in Coppell, Texas, you will want to know the differences between canceling and non-renewing a homeowner’s insurance policy. Put simply, not renewing an insurance policy means that the coverage is terminated at the end of the policy’s period, while canceling a policy means that the coverage is terminated before the end of the policy period. If you are not sure about your policy period, consult the declarations page, typically located at the front of the documentation that your insurance agent gave you.
Non-renewal does not necessarily indicate that you, the homeowner, have done anything wrong. In Texas, an insurance company can use your claims history to opt for non-renewal. To satisfy this condition, you must have filed three or more claims in a three-year period and the company must have notified you in writing after the second claim that a third claim may result in them not renewing your insurance policy.
If you have a policy that has been in effect for more than 60 days and then fail to pay your premiums, the insurance company may cancel your insurance if you do not respond to reminders about the past-due amount. Insurance companies can also cancel coverage if they determine that you lied on your application form or have committed an act of fraud during the application process.
Remember that if your insurance company cancels your homeowner’s policy, you do not have to disclose the reason why to a new insurance agent when you go looking for replacement coverage. Some insurance companies may decline to offer you insurance, though, if you have an unexplainable gap in your homeowners insurance coverage. It’s best to address this issue as soon as possible, so you can make sure you have uninterrupted coverage for what may be the most valuable purchase you make in your life.