Switching home insurance when you have escrow

1. Set the new Farmers policy to start the day the old one ends

Your new policy should have an effective date, not a gap and not an overlap you pay twice for. We set the Farmers effective date to the exact day you want the old policy cancelled. Never cancel the old policy first — if anything happened in between, you would be uninsured, and your mortgage servicer can force-place coverage that costs several times what you pay now.

2. Call your old carrier and your old agent — this part is on you

This is the step people skip, and it is the one that causes the problems. Buying a new policy does not cancel the old one. The prior carrier will keep billing, and if it is escrow-billed your mortgage company may pay both.

Call the old carrier's service line and your old agent, tell them you have switched to Farmers, and give them the cancellation date. Most carriers want it in writing — a signed cancellation request, an emailed request, or their online form. Ask for written confirmation of the cancellation and keep it.

• Tell them the exact cancellation date (the day your Farmers policy starts).
• Ask for a written or emailed cancellation confirmation.
• Ask whether the refund is pro-rata (most common) or short-rate.
• Confirm where the refund is sent — see the escrow note below.

3. Understand where the refund goes when you are escrow-billed

If your homeowners premium is paid out of escrow, the unused premium on the cancelled policy is normally refunded to the mortgage servicer, not to you — because the servicer is who paid it. That money lands back in your escrow account.

Your new Farmers premium is then billed to the same escrow account. If the new premium is lower, your escrow analysis at the next review usually produces a surplus check or a lower monthly payment. If it is higher, the payment adjusts up. Nothing about the switch changes your loan; only the insurance line of the escrow changes.

If you pay the premium yourself and not through escrow, the refund comes to you directly.

4. Get the new declarations page to your mortgage company

The lender needs proof of the new policy, with their mortgagee clause and loan number listed exactly right, or escrow will not release payment. We send the declarations page to the mortgagee on your behalf as soon as the policy is issued — but servicers lose documents, so we also want you to confirm it landed.

Many national servicers use the same insurance-tracking portal. You can look up your loan, see what coverage they currently have on file, and upload your new Farmers declarations page yourself:

5. Verify in 10 to 14 days

Log into your mortgage servicer's website and check that the insurance carrier on file says Farmers. Then log into your Farmers account to confirm the bill shows as mortgagee-billed rather than direct. If either one still shows the old carrier, call us — we will chase it.