Got a Home Insurance Non-Renewal Notice? 5 Steps to Take in the First Week

Few pieces of mail make a homeowner's stomach drop like a non-renewal notice. It usually arrives in a plain envelope, it is written in legal language, and it gives you a date after which your home will no longer be insured by that company. If you live in Roseville, Granite Bay, Auburn, Folsom or the foothills, you are not alone. Over the last few years thousands of Sacramento-area homeowners have received one.

The good news: a non-renewal is a deadline, not a disaster. In California you get real lead time, and what you do in the first week makes the rest of the process much easier. Here are the five steps we walk our own clients through.

Step 1: Read the notice for three things

Don't skim it. Find and write down:

1. The effective date. This is the day your current coverage ends. California generally requires insurers to give at least 75 days' notice before non-renewing a homeowners policy, so you should have more than two months. Mark the date on your calendar and set a reminder 30 days before it.
2. The stated reason. The notice should tell you why. Common reasons are wildfire risk, roof age or condition, prior claims, or the company reducing how many policies it writes in your area. The reason matters, because some reasons can be fixed and some cannot.
3. Who to contact with questions. Keep this. You may want to ask the company for more detail on the reason, especially if it is about your property's condition.

Step 2: Check whether a moratorium protects you

After a declared wildfire emergency, the California Insurance Commissioner can issue a one-year moratorium on non-renewals for homes in and near the fire area. If your ZIP code falls inside a current moratorium, the insurer may not be allowed to drop you yet, even if a notice went out.

You can look up active moratoriums on the California Department of Insurance website by ZIP code. It takes two minutes and occasionally changes the whole picture. Even if you are protected for now, treat it as extra time to shop, not a permanent fix.

Step 3: Gather your paperwork now

Every agent or carrier you talk to will ask for the same things. Pulling them together on day one saves you a week of back-and-forth:

• Your current declarations page. This shows your dwelling limit (Coverage A), deductible, liability limit and any endorsements. It's the single most useful document for a new quote.
• Your home's details. Year built, square footage, roof type and the year it was replaced, plus the years your electrical, plumbing, water heater and HVAC were last updated. Permit records or receipts help.
• Your claims history. List any claims from the last five years. If you're not sure, you can request a free copy of your CLUE report, which is the claims database insurers check.
• Mortgage information. Your lender's name, loan number and the mortgagee clause. Your lender will need proof of new coverage before the old policy ends.

Step 4: Fix what you can, and document it

If the reason on the notice is something you control, act on it and take photos. California insurers are required to recognize certain wildfire mitigation steps when they price policies. Things that tend to help:

• A Class A fire-rated roof, or a roof replacement if yours is near the end of its life
• Five feet of noncombustible space around the house (gravel, pavers, no bark mulch or wood piles against the walls)
• Ember-resistant vents and enclosed eaves
• Cleared gutters and trimmed trees away from the roofline
• Defensible space out to 100 feet where your lot allows it
• Membership in a Firewise USA community, if your neighborhood has one

Even if your current insurer won't reverse its decision, these improvements and the photos to prove them make your home more attractive to the next company.

Step 5: Shop with an independent agent, early

This is the step people wait too long on. If you call a captive agent who represents only one company, you get one set of underwriting rules and one answer. If that answer is no, you start over.

An independent agency like ours works with many carriers at once, including admitted companies that are still writing in the Sacramento area and specialty (surplus lines) carriers that can price homes the standard market passes on. One conversation gets your home in front of several companies at the same time. Starting in the first week, instead of the last, means you can compare offers rather than take whatever is left.

A few tips when you shop:

• Don't let the dwelling limit drop just to save money. Make sure Coverage A matches what it would actually cost to rebuild your home, not its market value.
• Ask about bundling. A carrier that hesitates on a home by itself will sometimes write it when the auto policy comes along.
• Get the new policy bound before the old one ends. A gap of even one day can cause trouble with your lender and make future coverage harder to find.

The bottom line

A non-renewal notice is stressful, but in California it comes with time to act. Read the notice, check for a moratorium, pull your paperwork together, fix what you can, and start shopping right away. Homeowners who start in week one almost always end up with better options than those who start in week ten.

If you've received a non-renewal, call our Roseville office at (916) 878-5160 or send your declarations page through the free quote form at bagwellagency.com. We'll read the notice with you and tell you honestly where your home stands.