Receiving a cancellation notice for your homeowners insurance policy in Colorado has become increasingly common. In 2023 alone, the state saw a 77% increase in nonrenewals compared to 2018, with areas like Grand County being hit especially hard. This surge is largely due to insurers reassessing their exposure to natural disasters, as Colorado ranks second in the nation for hail damage claims and continues to face growing wildfire risks.

The financial burden on homeowners has also intensified. Between 2018 and 2023, the average homeowners insurance premium in Colorado jumped by 57.9%, now averaging around $3,200 per year. This sharp increase is driven by a combination of factors, including the rising frequency of natural disasters, increased rebuilding costs, and higher claim payouts.

In response, several major insurance carriers have begun reducing their presence in the state. In 2024, American National Group announced its exit from the Colorado homeowners insurance market, citing substantial underwriting losses over the past decade. Other insurers, such as Allstate, State Farm, and Farmers Insurance, have also scaled back their coverage in high-risk areas, making it even more challenging for homeowners to secure reliable insurance options.

If you’ve received a non-renewal notice from your homeowners insurance company, it’s crucial to take immediate action. Securing a new policy as soon as possible will help you avoid potential coverage gaps and financial risks. The key is to understand your options and find a provider that meets your needs.

If you are losing your homeowners insurance, here’s what you need to do next.

Contact Your Insurer Immediately

When you receive a homeowners insurance cancellation notice, your first step should be to contact your insurer to understand the reason behind it. Some cancellations can be reversed, while others require immediate action to maintain coverage.

1. Identify the Reason for Cancellation

Common reasons for cancellation include:

• Missed Payments – If you’ve fallen behind, many insurers allow a grace period to catch up and reinstate coverage.
• Property Maintenance Issues – Insurers are increasingly scrutinizing risks like outdated roofs, electrical hazards, and overgrown vegetation, which may lead to cancellations if unaddressed. Some allow coverage to continue if repairs are scheduled, but some now use satellite imaging to assess properties remotely. These images help detect issues like missing shingles or overgrown trees near power lines. If flagged as high risk, homeowners may need to make repairs to keep coverage, making proactive upkeep essential.
• High-Risk Location – Homes in wildfire-prone areas like Boulder County, Grand County, and the foothills west of Denver face a higher risk of policy cancellations. Areas near dense forests, steep terrain, or past wildfire burn scars—such as Nederland, Estes Park, Evergreen, and parts of Colorado Springs—are especially vulnerable. Insurers are limiting coverage in these regions due to the increasing frequency and severity of wildfires, making it harder for homeowners to secure or renew policies.
• Frequent Claims – Multiple claims in a short period can make homeowners ineligible for renewal.
• Insurer Exiting the Market – Some companies, like American National and Farmers, have scaled back in Colorado, leaving policyholders without renewal options.

2. Ask About Reinstatement Options

Depending on the reason for your policy cancellation, you may have options to reinstate coverage. Many insurers allow reinstatement if corrective actions are taken promptly. Contact your provider as soon as possible to understand their specific requirements and deadlines. Common reinstatement options include:

• Paying Missed Premiums – If your policy lapsed due to non-payment, you may be able to restore coverage by paying the overdue amount within the grace period.
• Providing Proof of Repairs – If the cancellation was due to property condition concerns, insurers may reinstate your policy if you submit documentation of completed or scheduled repairs, such as replacing outdated wiring, fixing a damaged roof, or upgrading plumbing.
• Implementing Fire Mitigation Measures – Homes in wildfire-prone areas may qualify for reinstatement after taking steps like installing fire-resistant roofing, clearing vegetation around the property, or adding ember-resistant vents.
• Updating Home Security Features – If your policy was dropped due to security concerns, adding monitored alarm systems, reinforced doors, or security cameras could help regain coverage.
• Requesting an Inspection – Some insurers may reinstate coverage if an updated home inspection confirms that previous concerns, such as structural risks or outdated safety features, have been addressed.

Each insurer has different reinstatement policies, so it’s important to act quickly and provide necessary documentation. If reinstatement isn’t an option, consider reaching out to an independent broker like Castle Rock Insurance to explore alternative coverage solutions.

3. Get Written Confirmation

If reinstatement is granted or you’re given an extension to complete repairs, request written confirmation to avoid gaps in coverage. Having documentation ensures your home remains protected and prevents misunderstandings with your insurer.

4. If You Have Solid Evidence That Your Insurance Carrier Injustifiably Dropped You, Contact DORA

The Colorado Division of Insurance (DOI), under the Department of Regulatory Agencies (DORA), regulates insurance companies and investigates unfair cancellations. If your homeowners insurance policy was canceled or non-renewed without proper notice or a valid reason, you have the right to file a complaint. Gather your policy documents, cancellation notice, and any supporting evidence, then submit a complaint through the Colorado DOI website. The DOI will review your case and determine if the insurer acted improperly. If you need immediate coverage while your complaint is under review, Castle Rock Insurance can help you find alternative insurance options.

Shop for New Coverage

If your homeowners insurance has been canceled, securing a new policy should be a top priority. A lapse in coverage can leave you financially exposed and may even violate your mortgage agreement. Since many insurers have reduced their presence in Colorado, working with an independent insurance broker is the best way to compare multiple options. Castle Rock Insurance has access to 20+ personal and residential carriers and 100+ total specialty carriers, including providers that still insure homes in fire zones. Whether you need standard homeowners coverage or specialized protection for high-risk properties, they can help you find a policy that fits your needs.

When searching for new coverage, it’s important to look beyond just the price. Policies vary in their wildfire and hail damage protections, deductible structures, and replacement cost versus actual cash value payouts. Additionally, some insurers offer discounts for bundling home and auto policies, installing security systems, or making fire mitigation improvements. Castle Rock Insurance understands Colorado’s unique risks and can help homeowners secure reliable policies that balance affordability with comprehensive protection. If your insurer has canceled your policy, now is the time to explore your options and ensure your home remains protected.

Consider the Colorado FAIR Plan

If you’re struggling to find homeowners insurance after a cancellation, the Colorado Fair Access to Insurance Requirements (FAIR) Plan may be an option. This state-backed insurance program is designed for homeowners denied coverage in the private market due to wildfire risk, high claims history, or living in designated high-risk areas. The FAIR Plan provides a basic level of insurance to ensure homeowners can maintain coverage, but it is not intended to replace traditional policies. While it can serve as a safety net, it’s important to understand that FAIR Plan policies often come with higher premiums and more limited coverage than private insurers.

Before opting for the FAIR Plan, homeowners should explore all available private insurance options, as independent brokers like Castle Rock Insurance can often find coverage even in difficult situations. The FAIR Plan typically offers basic fire and property damage protection but may exclude important coverages like personal liability or additional living expenses in case of a disaster. Additionally, because FAIR Plan rates are based on higher-risk properties, premiums can be significantly more expensive. If you are considering this option, it’s best to consult with an experienced insurance professional to determine whether the FAIR Plan is the right fit or if there are alternative policies available that provide better coverage at a more competitive rate.

Implement Risk Mitigation Measures

Reducing the risk of damage to your home can make it easier to secure insurance coverage and may even lower your premiums. Many insurers evaluate a property’s resilience against hazards like hail, wildfires, and severe storms when determining coverage eligibility and rates. Homeowners in Colorado can take proactive steps to improve their home’s insurability, such as installing hail-resistant roofing materials, reinforcing windows and doors, and upgrading old electrical and plumbing systems to reduce fire hazards. Additionally, maintaining proper drainage and sump pumps can help prevent water damage, which is another common factor in insurance claims.

In wildfire-prone areas, creating defensible space around your home is one of the most effective ways to reduce risk. This includes clearing dry vegetation, trimming overhanging branches, and using fire-resistant landscaping materials. Some homeowners may also qualify for insurance discounts by installing sprinkler systems, fire-resistant siding, and ember-resistant vents. Insurers often provide incentives for risk mitigation efforts, and working with an independent broker like Castle Rock Insurance can help you find carriers that reward these upgrades with better coverage options and lower rates. Investing in these measures not only enhances the safety of your home but also strengthens your ability to secure affordable and comprehensive homeowners insurance.

Stay Calm & Get Insured

While getting a non-renewal notice from your insurance company can be stressful, there are options available to ensure you remain protected. By taking immediate action—whether it’s contacting your insurer to explore reinstatement, shopping for new coverage through an independent broker like Castle Rock Insurance, or considering risk mitigation strategies—you can find a solution that fits your needs. Even if private insurers are scaling back in Colorado, resources like the Colorado FAIR Plan and specialized high-risk carriers can provide alternatives. The key is to act quickly, assess your options carefully, and secure a policy that safeguards your home and financial stability.