Canceling a renters insurance policy is easy to do, but doing it improperly or at the wrong time can cost you money. Here’s what you need to know about when and how to cancel your renters insurance.
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When can I cancel my renters insurance?
You can cancel your renters insurance at any time for any reason. Though some companies charge a fee for ending a policy early, these fees tend to be relatively small, such as 10% of the premiums you no longer owe for the remainder of your policy term.
You can typically end your coverage immediately or schedule your policy to terminate on a future date.
If you’ve prepaid, you’re entitled to a refund on premiums for coverage beyond your cancellation date. Insurance companies typically deduct your cancellation fee, if any, from your refund check.
If you are behind in your renters insurance payments, you are still responsible for premiums for coverage up to the cancellation date.
Selecting a renters insurance cancellation date
In general, you want to schedule your existing renters insurance policy to end on the same day as a new or replacement policy begins. Here are a few things to consider as you choose your cancellation date.
When does a renters insurance policy begin and end?
A renters insurance policy typically begins at 12:01 a.m. on the first day of the policy period and ends at the same time on its cancellation or expiration date. Scheduling your current one to end on the same day as your new policy begins allows you to avoid both a lapse and an overlap in coverage.
Renters insurance when you move
If you are moving, it’s generally best to keep your current renters insurance in place until after you complete your move for a few reasons:
- Renters insurance provides some coverage of your possessions while they are being moved or in a storage unit.
- Most renters policies cover your items in full after they are unloaded in your new home for up to 30 days after you take up residence, unless the policy term ends before then or you cancel.
- The other coverages in your renters policy, including additional living expenses and personal liability, remain in force before, during and after your move, until you cancel your policy or it expires.
The risks of a renters insurance lapse
The biggest risks of letting your renters insurance lapse are potentially large out-of-pocket expenses if your belongings are damaged or stolen while you are uninsured, but there are other risks to consider.
Even if you don’t have very many possessions to protect, the additional living expenses and/or liability coverage in your renters insurance policy could save you hundreds, if not thousands, of dollars if you need them.
The other risks to consider when you cancel renters insurance include:
- Lease violations: If your landlord requires renters insurance, canceling your policy may put you at risk of penalties for violating your lease.
- Higher future insurance rates: Establishing an insurance history with few or no claims often helps you qualify for lower rates on future coverage. Without these discounts, you are likely to be charged more for insurance in the future until you re-establish a favorable insurance history.
As an alternative to canceling renters insurance, consider comparing renters insurance quotes from other companies to see if you can get a lower rate. Increasing your renters insurance deductible typically also lowers your rate.
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How do I cancel renters insurance?
The easiest way to cancel your renters insurance is to call your insurance agent or the company’s customer service center and let them know the date you’d like your coverage to end.
You usually need to have your policy number handy, and you may be asked to also submit your request in writing, depending on the company. If you manage your policy online or on your insurance company’s smartphone app, you may be able to cancel your policy through either of these channels.
Whether you cancel by phone, online or through an app, make sure to get written confirmation of your request, and double check to make sure the cancellation date shown in the confirmation notice is accurate.
A renters insurance cancellation no-no to avoid
The worst way to cancel your renters insurance is to simply stop paying premiums without notifying the insurance company that you want to terminate the policy.
When an insurance company cancels your renters insurance for non-payment, you are responsible for premiums up to the insurance company’s cancellation date. Unfortunately, this may include coverage for more days than you need, in addition to a potential cancellation fee.
Having your insurance canceled for non-payment of premium also has a negative impact on your insurance history. This, in turn, may result in higher insurance rates in the future.
Can I transfer my renters insurance when I move?
You can often transfer your renters insurance for a move to a new rental unit in the same state, but an out-of-state move or a status change to homeowner typically requires a new insurance policy.
For an in-state move, transferring your renters insurance to a new rental unit usually only requires you to provide your new address and move-in date to your insurance agent.
Your rate is likely to change when you move, depending on how the insurance rate factors stack up in your new neighborhood. For example, if you’re moving to an area with a lower crime rate or lower fire or disaster risks than your current location, your rate may come down.
Your insurance agent should be able to quote your new rate before you move. If it seems too high, you’re free to shop around for a cheaper rate with other companies.
If you are moving to a rental unit in a new state, you usually need to obtain a new policy, even if you plan to stay with the same company. Regardless of the company, policies vary from state to state, based on each state’s regulations.
Since insurance agents are also regulated at the state level, you usually also need to find a new insurance agent when you move to a new state, unless your current agent is also licensed in your new state.
If your current insurance company operates in your new state, you can ask them to help line up a new policy for you, but you don’t have to. If you already have a confirmed new address and move-in date, you can usually get accurate quotes before you move and set up your policy in advance.
Transitioning to home ownership
If you are moving into a house or condominium that you have purchased, you’ll need to replace your renters policy with homeowners insurance.
If you’re not moving into your new home on your purchase date, find out how your new homeowners policy covers property away from your new home:
- Many home insurance policies place a sublimit on coverage for property when it’s away from the insured home. If your new home insurance policy contains a sublimit, you may be better off keeping your renters insurance active until after you move, to maintain full coverage on your possessions.
- If your new home insurance does not have a sublimit on property away from the insured home, you are usually better off scheduling your renters insurance to end on the same date that your new homeowners insurance policy begins.
Frequently asked questions?
Can you cancel renters insurance?
You can cancel renters insurance anytime you please. Some companies charge an early termination fee, but these fees tend to be small.
Do you need renters insurance before moving in?
When landlords require renters insurance, they typically require your policy to begin on your move-in date or the first day of your lease term.
Do I get a refund if I cancel my renters insurance?
If you cancel renters insurance, the insurance company is required to refund premiums you’ve prepaid for coverage beyond the date your policy ends, minus the insurance company’s cancellation fee, if it charges one.
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