Can Homeowners Insurance Drop You?

Homeowners insurance companies can cancel or choose not to renew your policy for several reasons, including missed payments, excessive claims, property risks or fraud. Insurers regularly evaluate risk and may drop your coverage if they determine it's no longer viable. You'll typically receive written notice, but a coverage gap leaves your home financially vulnerable during emergencies. Understanding why insurers cancel policies can help you take action to stay insured and avoid disruptions.

Homeowners insurance can drop you after a claim if the insurer considers you a higher risk. The decision often hinges on the nature and frequency of claims. Insurers might cancel policies if they anticipate future claims that could affect their financial stability.

Here are examples of when homeowners insurance providers might drop you after a claim:

Insurers may view you as a higher risk after being dropped by your provider, which can lead to higher premiums, fewer coverage options and stricter policy terms.

Here's what to expect and why acting quickly matters if your homeowners insurance is canceled or not renewed:

If your homeowners insurance provider drops you, start by contacting the insurer to understand the reason. Then, shop for a new policy immediately to avoid a coverage gap. You can also reach out to your state’s insurance department or look into FAIR Plan coverage if traditional insurers deny you.

Getting homeowners insurance after being dropped or not renewed can be challenging, but it's possible with the right approach. Understand the reasons for your policy cancellation and address those issues promptly. Follow these steps to get new homeowners insurance after being dropped.

A Fair Access to Insurance Requirements (FAIR) Plan is an option if traditional homeowners insurance providers can't cover you. These plans are designed for homeowners with risk factors that typically worry traditional insurers, such as those in high-risk locations. FAIR Plans are state-run and supported by taxpayers and commercial insurance carriers.

FAIR Plans operate differently from traditional insurers, using shared market plans that distribute risk among several insurers. While they provide basic coverage, it's usually restricted and often only covers personal property and dwelling on a named perils basis. You may have limited or no options for liability, medical expenses or loss of use coverage. Despite these drawbacks, a FAIR Plan can provide essential protection for your home if other options aren't available.

You may face a home insurance cancellation if you don't make your premium payments on time or if your insurer suspects fraudulent claim activity, among other reasons.

Preventing being dropped by your homeowners insurance provider involves making timely premium payments, minimizing claims and keeping your property in good condition. Here are tips to help you maintain your home coverage:

Homeowners insurance companies can cancel or not renew your policy for reasons like missed payments, frequent claims or changes in risk. If this happens, act quickly — address the issue, compare new quotes and secure coverage to protect your home and finances.

Navigating homeowners insurance can be challenging, especially when facing the possibility of being dropped by your provider. To help you understand and manage these situations, we've compiled a list of frequently asked questions.

MoneyGeek analyzed quotes from multiple insurance providers across the U.S. using a profile that reflects the average homeowner. By considering different locations and companies, we aim to give a reliable estimate of what homeowners can expect to pay — showing why it’s important to compare rates. 

Homeowner Profile

For our analysis, we created a sample homeowner profile with the following characteristics:

• Good credit score (769–792)
• Home constructed in 2000
• Wood-frame construction
• Composite shingle roof

Homeowners Insurance Coverage Details

Unless otherwise specified, we used the following coverage limits to collect quotes for our comparison:

• $250,000 in dwelling coverage
• $125,000 in personal property coverage
• $200,000 in personal liability coverage
• $1,000 deductible

We also compiled data for policies with broader coverage to determine the best companies for insuring expensive homes, upping limits to $1 million in dwelling coverage, $500,000 in personal property coverage and $1 million in liability coverage.