What happens if your home insurance lapses?

If you don’t pay your insurance bill on time, you’ll have a “lapse in homeowners coverage” until you pay the balance or find a new policy.

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Pat HowardManaging Editor & Licensed Home Insurance ExpertPat Howard is a managing editor and licensed home insurance expert at Policygenius, where he specializes in homeowners insurance. His work and expertise has been featured in MarketWatch, Real Simple, Fox Business, VentureBeat, This Old House, Investopedia, Fatherly, Lifehacker, Better Homes & Garden, Property Casualty 360, and elsewhere.

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Homeowners in areas at high risk of hurricanes, tornadoes, wildfires, and other natural disasters have seen their rates skyrocket or been dropped by their home insurance company altogether. To get your home protected again, our expert home insurance agents at Policygenius can walk you through alternatives to traditional home insurance to help you find a policy at the lowest price possible — whether that's through surplus lines carriers, regional insurers, or your state’s FAIR plan.

If you don’t pay your policy premium by its due date, you’ll experience what’s called a lapse in coverage, meaning you’ll be without homeowners insurance. At this point, your insurance company may give you a grace period to pay your balance and reinstate your policy.

While a brief lapse in coverage might not seem like a huge deal, going without homeowners insurance for even a day or two puts you at financial risk. Additionally, many insurance companies won’t accept late premium payments. So if you continually miss payments, your policy could be canceled automatically.

Key takeaways

  • If you stop making insurance payments, your policy will lapse and your home will be unprotected after a fire, storm, or burglary.

  • When your policy lapses, you’ll have to pay for any losses out of pocket.

  • Not all homeowners insurance providers allow for late payments.

  • Having a policy lapse on your record could lead to higher rates or denial of coverage going forward.

What happens if my homeowners insurance lapses?

 A few different scenarios might play out if your homeowners insurance policy lapses.

Your mortgage company could purchase insurance for you

If you stop making homeowners insurance payments, your insurer will likely notify your mortgage lender. Since your mortgage company is a loss payee on your policy, it receives any paperwork from the insurance company that policyholders receive, including a lapse or policy cancellation notice. 

Since most lenders require home insurance as a condition of your mortgage, your lender will likely purchase forced-placed insurance (also called lender-placed coverage) for your home. You’ll then pay the policy premiums into an escrow account via your mortgage payment. Forced-placed insurance is generally more expensive and contains less coverage than standard homeowners insurance — so it should be avoided if you can.

Your homeowners insurance premiums may go up

Insurance companies consider financial health to be a big indicator of insured risk. The lower your credit score, the likelier you are to file an insurance claim. Similarly, if your homeowners insurance lapses because you failed to pay your premiums, that could be an indicator to your next insurer that you lack financial stability and you’ll likely be charged higher premiums.

It may be harder to get insurance going forward

Similar to how insurance companies may turn down applicants who have too many claims on their record, some companies will also refuse to insure your home if you have any gaps or lapses in your insurance history.

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Why did I lose my home insurance coverage?

You might lose your home insurance coverage due to a few different reasons:

  • Not paying your bill on time. Some insurance companies accept late payments, while others don’t. Too many non-payments or late payments can cause a lapse in coverage.

  • Lying on your application. If you didn’t disclose to your insurer that you own a rottweiler or a trampoline, they might cancel your policy if they find out.

  • Your insurer now considers you high-risk to cover. If you made too many late payments or filed a lot of claims in a short period of time, your insurer might consider you too high-risk to cover and cancel or not renew your policy.

  • You didn’t make proper updates after a failed home inspection. If you were told you need to replace your old roof or outdated plumbing system within six months after a failed home inspection and never made the updates, your insurance company can cancel your coverage.

If you lose coverage for any of the above reasons, you’ll have to pay for any losses to your home out of your own pocket. Some insurance companies offer anywhere from a 10 to 30-day grace period if you forget to make a payment. You’ll typically receive a letter of non-payment telling you to pay your premium ASAP to avoid your coverage lapsing.

Can I get homeowners insurance after a coverage lapse?

Yes, it’s possible to get homeowners insurance after a coverage lapse. Depending on the reason, your insurance company may reinstate your policy after it lapsed. If this happens, be sure to inform your mortgage lender so it knows to cancel any force-placed coverage that was placed on your home.

How to reinstate lapsed homeowners insurance

If your homeowners insurance policy has lapsed, there are several steps to take to reinstate it, including:

  1. Call your insurance company. Find out if you can still pay the unpaid balance to reinstate your lapsed policy.

  2. Apply for coverage through a new insurer. If you can't reinstate your lapsed home insurance policy, get quotes from other insurance companies to find a new one.

  3. Consider a FAIR plan. If you’re struggling to find home insurance after a lapse in coverage, consider applying for a policy via your state's FAIR Plan. A FAIR Plan is a type of last-resort coverage for homeowners who can't find insurance through a standard company. Like lender-placed insurance, FAIR Plans are more expensive and offer less coverage compared to standard home insurance.

Homeowners insurance lapse, cancellation, and nonrenewal: What’s the difference?

While home insurance lapses, cancellations, and nonrenewals all lead to the same outcome — not being protected and having to pay for any losses out of pocket — there are distinct differences worth pointing out. 

What it means

What's the cause?

Is notice required?

Lapse in coverage

Your home insurance is no longer active

Missed payment or multiple missed payments

It depends. In some states, insurers must give at least a 10 day notice if canceling for nonpayment


Your insurer terminates your policy before its expiration date

Change in risk, filing too many claims, or application fraud

Depends on the reason for cancellation


Your policy will expire at its expiration date

Change in risk, filing too many claims

Yes. Insurers are required to give a notice of anywhere from 20 to 60 days

Does a lapse in homeowners insurance affect your credit score?

According to Experian, insurance companies do not report payment history to the credit bureaus. [1] This means whether or not you pay your insurance premium on time will not impact your credit score, but you could still see a drop in your credit score if your insurance policy gets sent to collections.

Is it hard to get homeowners insurance after being dropped?

This likely depends on the reason. If you were dropped from coverage because your policy lapsed, you filed too many claims, or your home is considered too high risk to insure, you’ll probably find it hard to find insurance through a standard company.

How long is the grace period after a lapse in coverage?

Grace periods vary from company to company. But many insurers will give you anywhere from 10 to 30 days to pay your premium balance in the event of a lapse.

How to save on homeowners insurance

If you’re struggling to keep up with premium payments, consider the following ways to save on coverage.

  • Re-shop your policy: Not all homeowners insurance policies are created equal — and this applies to rates as much as the coverage itself. If you’re looking for an impactful way to find affordable rates after your policy has lapsed, re-shop your home insurance with Policygenius and compare quotes from multiple top companies to find the best deal.

  • Raise your deductible: Increasing your deductible is a good way to immediately lower your rates. Just make sure you have enough in savings to cover the higher out-of-pocket cost if you have to file a claim..

  • Look for discounts: Most insurance companies offer discounts for bundling your home and auto insurance, adding security systems to your home, or going more than 5 years without filing a claim. If you feel your premiums are too high, ask your insurer what discounts it has available.

  • Maintain a good credit score: Insurers take your credit into consideration when calculating your rates. Maintaining a good credit score is a way to keep homeowners insurance costs down. 

Frequently asked questions

What happens if you have a gap in homeowners insurance?

If your homeowners insurance is nonrenewed, canceled, or it lapses, you’ll have what’s referred to as a gap in coverage if you don’t find a replacement policy. Having a coverage gap is strongly discouraged, as it leaves your home exposed to uninsured damage and loss.

What is homeowners insurance nonrenewal?

Nonrenewal simply means your policy will expire at its expiration date. Either you or your insurance company can choose to nonrenew. Depending on your state, your insurance company will be required to give a notice of anywhere from 20 to 60 days if it chooses to nonrenew your policy. Most states also require insurance companies to provide a reason for nonrenewal.


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Policygenius uses external sources, including government data, industry studies, and reputable news organizations to supplement proprietary marketplace data and internal expertise. Learn more about how we use and vet external sources as part of oureditorial standards.

  1. Experian

    . "

    Do insurance companies report to credit bureaus?

    ." Accessed August 24, 2023.


Pat Howard is a managing editor and licensed home insurance expert at Policygenius, where he specializes in homeowners insurance. His work and expertise has been featured in MarketWatch, Real Simple, Fox Business, VentureBeat, This Old House, Investopedia, Fatherly, Lifehacker, Better Homes & Garden, Property Casualty 360, and elsewhere.

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