Can you cancel your home insurance at any time?

Can you cancel home insurance whenever you want?

Yes, you can cancel home insurance whenever you want, as the policy terms allow you to do so at any time. You do not have to wait until renewal. If you have a mortgage, make sure your replacement policy starts before the old one ends so your lender does not add force-placed coverage.

Your home insurance policy is a contract that affords you the right to cancel whenever you want. If you have a mortgage, you are required to keep insurance on your property. Before you cancel, have a new policy in place to avoid a lapse.

Is there a penalty to cancel home insurance?

Some insurers charge an early cancellation fee or keep a non-refundable policy fee when you cancel before the term ends. Others use a process called short-rating for early cancellations rather than pro-rating, which results in a reduced refund. Ask the company how it calculates refunds before choosing your cancellation date.

“Many companies have a policy fee that is non-refundable. Some companies have an early cancellation fee if you cancel the policy in the first term,” Pope says.

How to cancel homeowners insurance

To cancel your homeowners insurance, contact your insurance company and let the representative know you’d like to cancel, along with the date you'd like it to be effective. With most companies, this can be done over the phone. Some companies may require you to send the cancellation request in writing.

Even if you want to cancel your policy at the end of the term, you need to notify the company. Most homeowners insurance companies will automatically process your renewal unless they have heard from you.

Do you get a refund if you cancel homeowners insurance?

You get a refund if you paid for coverage beyond your cancellation date. The amount depends on how much unused premium remains and whether the insurer subtracts fees or short-rates the refund. If your premium is paid through escrow, the refund is sent to you, not directly to the mortgage company. 

If you are switching insurance companies and need to pay for the new coverage, contact your mortgage company to make sure there’s enough in the escrow account to cover the new premium.

When to cancel home insurance when selling a house

You should not cancel your home insurance until the sale of the house has closed and the house is legally the new owners' property. Until then, you are still responsible for the house and anything that happens on the property. Once the sale is complete, contact your insurer and cancel the policy effective on the closing date.

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