What does non-renewal of an insurance policy signify?

Non-renewal of an insurance policy signifies that the insurer will not extend the coverage once the current term expires. This means that the policyholder will need to seek a new insurance policy if they wish to maintain coverage for the insured risks. Non-renewal can occur for various reasons, such as changes in the risk profile, claims history, or the insurer's underwriting criteria.

The concept of non-renewal is crucial for both insurers and policyholders, as it allows insurers to manage their risk exposure while giving policyholders the opportunity to seek alternative coverage options. Understanding this term is vital in the context of insurance, as it highlights the non-perpetual nature of insurance contracts, which can be subject to reassessment at the end of each policy term.