304.20-320 Declinations -- Cancellations -- Nonrenewals -- Terminations -- Notice
of premium required.
(1)
(2)
(3)
Declinations. An applicant may request in writing an explanation of a declination.
The insurer shall provide a prompt written response to such inquiries.
Cancellations.
(a) A notice of cancellation of insurance subject to KRS 304.20-300 to 304.20350 by an insurer shall be in writing, shall be delivered to the named insured
or mailed to the named insured at the last known address of the named
insured, shall state the effective date of the cancellation, and shall be
accompanied by a written explanation of the specific reason or reasons for the
cancellation.
(b) The notice of cancellation referred to in paragraph (a) of this subsection shall
be mailed or delivered by the insurer to the named insured at least fourteen
(14) days prior to the effective date of the cancellation if the cancellation is for
nonpayment of premium or occurs within sixty (60) days of the date of
issuance of the policy. Such notice of cancellation shall be mailed or delivered
by the insurer to the named insured at least seventy-five (75) days prior to the
effective date of the cancellation if the policy has been in effect more than
sixty (60) days.
(c) Proof of mailing of notice of cancellation or of reasons for cancellation to the
named insured at the address shown in the policy shall be sufficient proof of
notice.
Nonrenewals.
(a) No insurer shall refuse to renew a property or casualty insurance policy
subject to KRS 304.20-300 to 304.20-350 unless at least seventy-five (75)
days before the end of the policy period as described in KRS 304.20-310(1),
the insurer shall mail or deliver to the named insured, at the last known
address of the named insured, written notice of the insurer's intention not to
renew the policy upon expiration of the current policy period with a written
explanation of the specific reason or reasons for the nonrenewal.
(b) If notice is not provided pursuant to paragraphs (a) and (b) of this subsection,
coverage shall be deemed to be renewed for the ensuing policy period upon
payment of the appropriate premium under the same terms and conditions, and
subject to the provisions of KRS 304.20-330, until the named insured has
accepted replacement coverage with another insurer, or until the named
insured has agreed to the nonrenewal.
(c) If the insurer has manifested its willingness to renew by mailing or delivering
of a renewal notice, bill, certificate, or policy to the first named insured at his
last known address at least thirty (30) days before the end of the current policy
period with the amount of the renewal premium charge and its due date clearly
set forth therein, then the policy shall expire and terminate without further
notice to the insured on the due date unless the renewal premium is received
by the insurer or its authorized agent on or before that date. When any policy
(4)
terminates pursuant to this subsection because the renewal premium was not
received on or before the due date, the insurer shall, within fifteen (15) days,
deliver or mail to the first named insured at his last known address a notice
that the policy was not renewed and the date on which the coverage under it
ceased to exist.
(d) Proof of mailing of renewal premium to the insurer or its agent, when
authorized, on or before the due date shall constitute a presumption of receipt
pursuant to paragraph (c) of this subsection.
(e) Proof of mailing of notice of intention not to renew or of reasons for
nonrenewal to the named insured at the address shown in the policy shall be
sufficient proof of notice.
No insurer shall increase the premium for a property or casualty insurance policy
subject to KRS 304.20-300 to 304.20-350 more than twenty-five percent (25%) of
the premium for the preceding policy term for like coverage and like risks unless at
least seventy-five (75) days before the end of the policy period as described in KRS
304.20-310(1), the insurer shall mail or deliver to the named insured, at the last
known address of the named insured, a notice for the renewal premium amount and
the insurer shall mail or deliver to its agent, if any, a duplicate notice of the
premium amount. In order to comply with this requirement, the insurer may extend
the period of coverage of the current policy at the expiring premium.
Effective: July 14, 2000
History: Amended 2000 Ky. Acts ch. 540, sec. 2, effective July 14, 2000. -- Amended
1990 Ky. Acts ch. 208, sec. 1, effective July 13, 1990. -- Amended 1988 Ky. Acts
ch. 97, sec. 2, effective July 15, 1988; and ch. 225, sec. 8, effective July 15, 1988. -Created 1986 Ky. Acts ch. 426, sec. 3, effective July 15, 1986.
Legislative Research Commission Note. The amendment in 1988 Acts Chapter 225
conflicts with that in 1988 Acts Chapter 97 in that Chapter 97 removes subsection
(4), while chapter 225 adds new language in subsection (4). Pursuant to KRS
446.250, the later enactment in chapter 225 prevails.
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