What happens if I need to cancel one policy?

Complete Guide to Canceling One Policy in a Home + Auto Bundle

Why This Question Matters for Colorado and Utah Residents

Bundling home and auto insurance delivers significant savings—up to 26% in Colorado and Utah, with bundled customers averaging $600 in yearly discounts. But if you need to cancel one policy, understanding the regional impact on your coverage and costs is crucial.

• Premium Impact: Most Colorado and Utah insurers remove your 11–26% bundle discount upon cancellation—State Farm bundle customers, for example, could see a $400–$800 increase in annual premiums.
• Regional Risks: Weather events like hail or wildfire are common locally. Bundling often makes claims easier and sometimes unlocks single-deductible options—which are lost with separation.
• Changing Market Conditions: With 32% of carriers in the region reducing policy exposure in high-risk areas, bundled clients often receive preference for renewals and better stability.

What Most People Get Wrong

A common misconception is that canceling a single policy won't dramatically affect your remaining coverage or costs. In reality, you lose both the discount and sometimes enhanced benefits—like more generous hail deductibles or streamlined claims service—which are highly valuable where hail and wildfire exposure is above national averages.

Another mistake is assuming the increased premium will be minor. In Loveland or Fort Collins, losing the discount can mean paying $500+ more each year depending on your carrier and risk profile.

The Complete Picture

Brokers and carriers in Colorado and Utah design bundle discounts to encourage long-term relationships. Canceling one policy removes the incentive, so your remaining policy adjusts to its standard, higher rate. You’ll also want to watch for changes to deductible structures—many regional bundles include perks like single deductible options for weather events (e.g., one $1,000 charge for roof and vehicle hail damage instead of paying for each individually).

For those in high-risk ZIP codes or with older roofs, the loss of bundled preference could risk nonrenewal if your carrier reduces exposure in your area. Before making a change, compare the new solo premium, check for missing endorsements, and always consult with a local advisor familiar with Colorado and Utah’s unique insurance landscape.

Making the Right Decision for Colorado and Utah Residents

Question 1: What’s the true cost of canceling one policy?

Calculate the increased premium and any loss of special endorsements or deductible options in your bundle.

• Ask your agent to quote both pre- and post-cancellation rates.
• Review differences in hail/wildfire deductibles and liability coverage.

Question 2: Is the switch financially smarter in the long run?

Consider both immediate savings and potential long-term costs—like higher premiums after losing loyalty discounts, loss of claim forgiveness, or disenrollment from preferred renewal pools (important as carriers increasingly reduce exposure in high-risk areas).

Question 3: Do I have a backup plan for severe weather or market changes?

Ensure your remaining policy covers regional risks, as weather damage and wildfires are rising in Colorado and Utah. Bundles often come with enhanced protection—ask if you’ll need special riders (like for hail or roof replacement cost) to stay fully protected after canceling one policy.