What is a home insurance renewal?
Like most Insurance renewals, a home insurance renewal is when your insurer offers to renew your homeowners insurance for another term. Most home insurance policy terms are a year, so your insurance renewal date is one year after your effective date. However, your provider needs to notify you that your renewal is coming up by sending you an insurance renewal notice 30 to 60 days beforehand.
Does homeowner insurance automatically renew?
If by “automatic” you mean your policy continues if you keep paying your premium, then you could say your home insurance automatically renews.
However, most states legally require insurance companies is to notify policyholders that their policies are up for renewal. The laws governing this practice vary by state, but most policyholders get a renewal notice a month or so prior to their policy’s expiration date.
An insurance renewal notice typically includes information about your:
For example, your dwelling coverage may change if construction costs go up in your area because that makes it more expensive to rebuild after a catastrophic event. That increase may also impact your premium.
Once you receive a home insurance renewal notice, you can either accept your insurance company's offer or shop around for a new policy. Doing nothing and continuing to pay your premium generally means you accept the offer and your insurance company renews your coverage. But if you decide not to renew, then you need to contact your insurer. Some may need your cancellation notice in writing.
Things that impact your home insurance renewal
One reason you get your insurance renewal notice at least one month before your expiration date is so you have time to dig into the new policy. You’ll want to look for:
Changes to your premium. Your rate may go up or down depending on events that occur during the life of your previous policy. Some you don’t have much control over, like inflation or or an increased exposure to risk. But some types of claims can also impact your costs.
Coverage adjustments. Your dwelling coverage may adjust with construction costs, but that’s not the only way your coverage might change. Your insurer might add exclusions in some cases. And remember that personal property, loss of use, and other structures limits are percentages of Coverage A, so modifying your dwelling coverage affects the others.
You also need to let your insurer know of any changes in your situation, such as:
Home remodeling projects.
Newly purchased valuables.
Updates to your roof.
Changes to your wealth.
A new dog.
A new security system.
Any new family members or roommates.
Change in occupancy.
Change in title of the property.
A few of these changes may mean you need to pay a higher premium, like a remodeling project that adds square footage to your home. Not disclosing them, however, could mean claims are denied later on. Moreover, certain upgrades, like a new roof or burglar alarm, may reduce your costs.
Either way, you want to contact your insurance agent to discuss your renewal. Kin members can do that simply by calling in – no appointment necessary.
Will my rate go up when my home insurance renews?
When your home insurance renews, your premiums can go up or down. However, it’s pretty typical for your rates to go up slightly. This may happen if:
You file certain kinds of claims.
The market value of your home increases.
Inflation causes your home’s replacement cost to increase.
Your credit score changes.
Your insurance company increases its rates in your state.
Your insurer's reinsurance costs have gone up.
Some states, like Florida and Louisiana, have seen substantial state-wide rate increases in recent years. Much of this is due to the increasing frequency and severity of hurricanes, litigation, and rising reinsurance costs, but other factors can come into play.
Can my insurer decide not to renew my home insurance?
In some cases, when your home insurance policy expires, your insurer can choose not to renew the policy. The reasons for nonrenewal vary, but if it does happen, just know that you have options.
If your insurer has recently notified you that your policy will not be renewed, you can learn more about what to do next in our guide to home insurance nonrenewals.
How can I lower my home insurance premiums?
Homeowners insurance premiums don’t always go up at a renewal, but when they do, it can be frustrating for policyholders. If you’re in that situation, here are a couple of steps you can take that may help you get a lower premium:
Ask about discounts. Most insurance companies offer discounts for actions that benefit them, like signing up for paperless policies or installing security systems. Homeowners in hurricane-prone areas may also want to look into home hardening, too.
Increase your deductible. A higher deductible means you pay more in a claim, so choose an amount that fits your budget.
Look for a new insurance company. Every insurance company has its own way of determining price, so you may find a more affordable policy if you shop around.
If you decide to look for a new insurance company, use the details on your renewal notice to compare offers. You also want to lock in your new coverage and alert your insurance company that you’re canceling before your old policy expires. That way you avoid spending any time uninsured.
One important caveat: No matter what company you decide to get insurance from, you need to know about the underwriting discovery period.
And as long as you're shopping for home insurance, get a quote from us!