N.Y.: PIA offers agents and brokers guidance for personal-lines cancellations and nonrenewals

In New York state, personal-lines insurance policies come with a tightly regulated framework under Insurance Law Section 3425, setting specific rules for when and how policies can be canceled or nonrenewed. As an agent or broker, understanding these nuances isn’t just about compliance—it’s essential for setting client expectations, minimizing surprises and maintaining strong customer relationships.

Below is a summary of the cancellation and nonrenewal provisions—including both auto and non-auto personal lines—with practical takeaways for insurance professionals in the field.

Cancellation basics: Auto vs. non-auto

The law distinguishes between new policies, which may be more freely canceled within the first 60 days, and established or renewal policies, which are subject to stricter limitations.

New policies (first 60 days)

• Can be canceled for almost any reason (excluding discrimination or protected classes), with proper written notice and a reason provided.
• Minimum 20-day notice applies.

Established policies (beyond 60 days or renewals)

Cancellations are allowed only for specific statutory reasons, including:

• nonpayment of premium (15 days’ notice)
• fraud or misrepresentation
• material change in risk
• license or registration suspension (auto only)

Auto policies follow a one-year required policy period, while most non-auto personal-lines policies (e.g., homeowners, renters) require a full three-year policy period before nonrenewal becomes an option.

Nonrenewal rules: A closer look

Non-auto personal lines (homeowners, renters and umbrella). During the initial three-year required policy period, insurers cannot nonrenew a policy except for cause under the same grounds as cancellation. After that, they may nonrenew at the end of any one-year term with:

• written notice delivered 45 to 60 days prior to expiration;
• a specific reason for nonrenewal; or
• failure to provide this notice results in automatic renewal under current terms.

Automobile policies

Auto carriers may nonrenew at the end of the one-year policy term, with the same 45–60 day advance written notice. Nonrenewal must be based on underwriting or risk-related reasons, and carriers must document the rationale.

Conditional renewals

For any personal lines policy, if the insurer intends to:

• increase the premium by more than 10%;
• reduce coverage;
• add exclusions; or
• change deductibles or limits.

This must be communicated as a conditional renewal. Again, 45–60 days’ notice is required. If not properly communicated, the current policy terms continue unchanged for another term.

What about residual market plans?

Policies written through the New York Automobile Insurance Plan—for auto—and FAIR Plan—for property—operate under a separate regulatory structure, but similar principles apply—especially regarding notice and justifiable reasons for cancellation or nonrenewal.

Key agent takeaways

Watch the policy age. The rights and restrictions around cancellation/nonrenewal shift after year one (auto) or year three (non-auto).

Track your timelines. Missing the 45–60 days’ notice window can trigger unintended renewals.

Know your client’s risk factors. Things like property changes, driving records or payment history can all impact cancellation eligibility.

Communicate proactively. Often, clients mistake conditional renewals for cancellations. Your guidance can make the difference in retention.

Don’t let agency changes impact clients. Termination of a producer’s appointment is not grounds for cancellation or nonrenewal under the law.

Want to go deeper?

To view all the compliance rules, legal citations, and insurer obligations under Section 3425—including model notices and agent protections—PIA Northeast members can access the complete guide here.