How to Change Homeowner's Insurance in Escrow

By: Leigh Thompson

Homeowner's insurance protects you if your house is damaged.

home sweet home image by David Dorner from

Your escrow account serves as a sort of savings account. You place money into this account each month with your monthly mortgage payment. This money stays in the account until your homeowner's insurance premium and property taxes come due, at which time your lender pays them on your behalf. You are not stuck with your insurance company if you want to get a better deal. You simply need to notify all the interested parties when you change companies.

Step 1

Obtain quotes for new homeowner's insurance policies. Shop around to multiple insurance companies to get the best quote for your circumstances.

Step 2

Purchase new homeowner's insurance for your property. You typically need to pay the premium before the insurance policy goes into effect. Obtain a copy of your new homeowner's insurance declarations page.

Step 3

Cancel your existing homeowner's insurance policy. The insurance company is paid a year in advance. They will evaluate your account, issue a refund check for the remaining unused balance, and mail you a letter of cancellation.

Step 4

Contact your mortgage holder to tell them you have changed homeowner's insurance. Provide a copy of your new insurance declarations page and your notice of cancellation of the previous insurance policy.


  • You continue to pay a premium into your escrow account with your monthly mortgage payment. When you change to cheaper insurance, the mortgage company updates the amount of your mortgage payment to reflect this change. You will also receive a refund if you have paid too much into your escrow account.


  • You must notify your mortgage company when you change insurance. They issue the premium payment when it comes due. You don't want the mortgage company to pay the wrong insurance company.


About the Author

Leigh Thompson began writing in 2007 and specializes in creating content for websites. She has been published online in various capacities. Thompson has an associate degree in information technology from the University of Kansas and is working on a bachelor's degree in business and personal finance.

Photo Credits

  • home sweet home image by David Dorner from

Zacks Investment Research

is an A+ Rated BBB

Accredited Business.