Is It OK to Change Homeowners Insurance? What You Need to Know

Most people think once you pick a homeowners insurance company, you’re stuck with them until your house is paid off. Nope. You can swap insurance providers almost anytime—and sometimes it's one of the smartest money moves you can make.

The truth? Insurers change their prices every year. That means the quote you got when you first moved in could be way off the mark now. Maybe your neighbor pays hundreds less for better coverage. That's a little annoying, right? Turns out, shopping around can cut your premium by hundreds of dollars a year, no matter how long you’ve been in your home.

You don’t have to wait until your policy renews. You can actually switch in the middle of your contract. Most big insurance companies will refund unused premiums. That means if you cancel halfway through, you usually get money back. But there are smart ways to do this and a few things to triple-check before making the leap. I’ve seen folks forget to update their mortgage company, accidentally leave their house uninsured, or even pay for double coverage by mistake.

Don’t let these slip-ups scare you. Changing your homeowners insurance isn’t risky if you know what to watch for. It could even mean more coverage, peace of mind, and extra cash in your pocket. Let’s talk about why you might want to switch, how to do it without missing a beat, and how to sniff out a good deal from a dud.

• Why People Switch Homeowners Insurance
• How to Change Policies Without Trouble
• Mistakes to Avoid When Switching
• When Switching Makes the Most Sense

Why People Switch Homeowners Insurance

Switching your home insurance isn't some wild or risky move—it's actually surprisingly common, especially now. Prices and coverage can change every year, and different insurance companies all have their own way of crunching the numbers. The reason most people jump ship?

• Better prices: Rates went up a lot in the past few years. According to the National Association of Insurance Commissioners, U.S. homeowners insurance premiums went up nearly 12% in 2024 alone. Why pay more for the same coverage?
• More or better coverage: Maybe you've added a shed, redone your kitchen, or just want water backup protection. Some companies are better about letting you fine-tune your policy without jacking up the price.
• Poor service: If your insurance company left you hanging after a storm or made a claim way more stressful than it should've been, that's a top reason to look elsewhere. Quick, helpful customer support makes a difference when something bad actually happens.
• Changes in your life: People change insurance after refinancing, getting married, having a baby, or scoring a new job that lets them bundle for a group discount. Life isn't static—your policy shouldn't be either.
• Bundle deals: Companies love to offer discounts if you combine home and auto insurance together. Sometimes you can stack up 20% or more in savings just by putting the policies under the same roof.

Here’s a quick look at why folks swapped insurers last year. It’s not just a dollars thing—it’s about the whole package:

Switching your homeowners insurance is easier than people think, and most of the time, companies do all they can to earn your business. The trick? Don’t just stick with what you have out of habit. There are real savings and benefits if you’re willing to take a look around and compare.

How to Change Policies Without Trouble

Switching your homeowners insurance can feel like a hassle, but it’s a lot simpler when you break it down step by step. The biggest concerns are making sure there’s no gap in your coverage and keeping your mortgage company in the loop.

Here’s exactly what to do so your switch goes off without a hitch:

1. Shop Around First. Don’t just grab the first quote you find. Compare several, and focus on both price and coverage. Make sure the policy covers your belongings and meets your lender’s requirements.
2. Apply for the New Policy. Once you pick a winner, apply and get approval before you cancel anything on your old policy. The new company will set a policy start date, usually up to 30 days in advance if you need a little overlap for safety.
3. Let Your Mortgage Lender Know. Most homeowners pay insurance through their escrow account. If you switch, your lender needs to update their records or they might even buy a pricier policy for you. Send them your new policy details as soon as possible.
4. Cancel the Old Policy. Wait until your new coverage is confirmed and active. Then, cancel your old policy, starting on the new policy’s effective date. Ask for a written cancellation confirmation, just in case.
5. Check for Refunds. If you’ve already paid for the year, your old insurer will typically send a prorated refund for the unused months. This process can take a couple of weeks.

Here’s a quick look at common steps and how much time each one usually takes:

One last tip: Always print or save proof of both your new and old policies’ coverage dates. Most headaches happen because someone lost an email or forgot to sync the start and stop dates. A little paperwork now avoids stress later.

Mistakes to Avoid When Switching

Switching home insurance can totally work in your favor, but it’s also easy to mess up if you rush or miss the fine print. There are a few pitfalls that keep showing up, and trust me, you want to dodge them.

• Letting coverage lapse: Even a day without a policy in force can spell disaster if something happens—like a fire or severe storm. Always line up your new policy to start before or on the same day your old one ends. If you overlap by a day or two, that’s fine. Being uninsured is never worth the risk.
• Forgetting to tell your mortgage company: Most lenders require proof of constant insurance. If you switch and forget to update your bank, they can buy their own policy for you—called force-placed insurance—and bill you for it. It’s usually way pricier and offers less protection. As soon as you get your new policy, send your lender a copy pronto.
• Assuming every policy covers the same stuff: Policies can vary wildly on stuff like water damage, roof coverage, or personal property limits. Just picking the cheapest is tempting, but you could end up underinsured where it counts. Always double-check inclusions and exclusions, and look out for sneaky high deductibles.
• Not cashing in your refund: If you paid your old insurer for the whole year up front, you’re often owed a refund for unused time. Insurers usually issue this automatically, but mistakes happen. Stay on their case until you see that refund hit your account.

Consider these real numbers. According to the National Association of Insurance Commissioners’ 2023 data, the average homeowner paid roughly $1,428 annually, but prices varied a ton by region and even zip code. Here’s a look at how even small mistakes can cost you:

When you change homeowners insurance, slow down, compare your options, and check every box before you make it official. A little attention now stops big headaches later.

When Switching Makes the Most Sense

Wondering if you really need to change your homeowners insurance? There are some moments when switching just makes solid sense—and could save you money or headaches in the long run.

If your premium went up for no clear reason, don’t just shrug it off. Insurers raise rates every year, and sometimes it’s not even tied to your personal claim history. According to a 2024 study by Policygenius, the average annual homeowners premium in the U.S. jumped nearly 7%, mostly due to higher building costs and weather damage claims. If your bill suddenly got higher, it’s worth shopping around to see if someone else offers a better deal.

Big life changes can also make your current policy a bad fit. Did you finish a kitchen remodel, add a pool, or adopt a giant dog? Your old coverage might be too low or have new exclusions. Moving to a new area, getting married, or retiring can all affect your needs, too. Insurers weigh risk differently, so one company could treat your home as more high-risk while another doesn’t blink. If your situation has changed, don’t assume your old policy knows how to keep up.

Some folks switch after a bad claim experience. If your insurer left you hanging, denied a fair claim, or moved glacially slow, that’s usually the push people need. Your coverage is supposed to protect your peace of mind, so poor service is a deal breaker.

Bundling can be another reason to jump ship. You could score big discounts by having your auto, life, or umbrella policies with one insurer instead of juggling three separate companies. Always ask what bundle offers are available—sometimes that alone can save 10% or more on your home insurance.

Shopping for a better rate each year is way more common than you might think. Pew Research saw that 30% of homeowners changed providers at least once in the last five years, and those who did saved an average of $350 per year. It’s not just a few bargain-hunters—plenty of people out there are taking advantage of new-customer offers and incentives.

Bottom line: switching isn’t just something people do in an emergency. It’s a good way to make sure your coverage matches your real-life needs—and keeps your wallet from taking unnecessary hits.