Is there a difference between cancellation and nonrenewal?
Cancellation and nonrenewal are very different methods of policy termination. This article demonstrates the difference.
- You fail to pay the premium
- You have committed fraud or made serious misrepresentations on your application
- Your driver's license has been revoked or suspended.
The company may have decided to drop that particular line of insurance or to write fewer policies where you live, so the nonrenewal decision may not be because of something you did. On the other hand, if you did do something that raised the insurance company’s risk considerably, like driving drunk, the premium may rise or you may not have your policy renewed.
If your insurance company did not renew your policy, you will not necessarily be charged a higher premium at another insurance company.
Source: Insurance Information Institute - www.iii.org