What defines a "nonrenewal" in insurance?

In the context of insurance, a "nonrenewal" refers specifically to the situation in which an insurer decides not to renew a policy once its term has expired. This means that when the policy comes up for renewal, the insurer has chosen not to extend it, which may happen for various reasons such as changes in underwriting guidelines, claims history, or shifts in risk assessment. This action does not involve a cancellation during the policy term; rather, it occurs at the end of the policy period.

The distinction here is crucial as it separates nonrenewal from other actions like cancellation—where the policy may be terminated before the agreed end date—or voluntary actions by the insured, such as switching providers. Lastly, replacing a policy with a new one does not constitute nonrenewal, as it implies continuity in coverage through a new or different policy rather than the decision to cease renewing the current one.