77914838.2-231Virginia Decodedhttps://vacode.org2016InsuranceProvisions Of A General NatureNotice of cancellation, refusal to renew, reduction in coverage or increase in premium of certain liability insurance policies1986, c. 376, § 38.1-43.01; 1987, c. 697; 1988, c. 189; 1989, c. 728; 1992, c. 160; 1996, c. 237; 1998, c. 142; 2000, c. 529; 2003, cc. 387, 678; 2005, cc. 290, 635; 2006, c. 554; 2008, cc. 58, 221; 2009, c. 215; 2013, cc. 13, 257; 2015, cc. 9, 443; 2016, cc. 4, 71.http://law.lis.virginia.gov/vacode/38.2-231/13.1-543Definitions/13.1-543/13.1-603Definitions/13.1-603/13.1-803Definitions/13.1-803/38.2-111Miscellaneous property and casualty/38.2-111/38.2-117Personal injury liability/38.2-117/38.2-118Property damage liability/38.2-118/38.2-124Motor vehicle/38.2-124/38.2-1912Delayed effect of rates; certification of reinsurance with affiliated company/38.2-1912/38.2-2800Definitions/38.2-2800//38.2-231/38.2/2/38.2-23138.2-262538.2-3251. No cancellation or refusal to renew by an insurer of (i) a policy of insurance as defined in § 38.2-117 or 38.2-118 insuring a business entity; (ii) a policy of insurance that includes as a part thereof insurance as defined in § 38.2-117 or 38.2-118 insuring a business entity; (iii) a policy of motor vehicle insurance against legal liability of the insured as defined in § 38.2-124 insuring a business entity; or (iv) a policy of miscellaneous casualty insurance as defined in subsection B of § 38.2-111 insuring a business entity shall be effective unless the insurer delivers or mails to the first named insured at the address shown on the policy a written notice of cancellation or refusal to renew, or delivers such notice electronically to the address provided by the first named insured. Such notice shall:sectionAA1 Be in a type size authorized under § 38.2-311;sectionAaAa2 State the date, which shall not be less than 45 days after the delivery or mailing of the notice of cancellation or refusal to renew, on which such cancellation or refusal to renew shall become effective, except that such effective date may not be less than 15 days from the date of mailing or delivery when the policy is being cancelled or not renewed for failure of the insured to discharge when due any of its obligations in connection with the payment of premium for the policy;sectionAbAb2 State the specific reason or reasons of the insurer for cancellation or refusal to renew;sectionAcAc2 Advise the first named insured of its right to request in writing, within 15 days of the receipt of the notice, that the Commissioner of Insurance review the action of the insurer; andsectionAdAd2 In the case of a policy of motor vehicle insurance, inform the first named insured of the possible availability of other insurance which may be obtained through its agent, through another insurer, or through the Virginia Automobile Insurance Plan.
sectionAeAe2 Nothing in this subsection shall apply to any policy of insurance if the named insured or his duly constituted attorney-in-fact has notified orally, or in writing, if the insurer requires such notification to be in writing, the insurer or its agent that he wishes the policy to be canceled or that he does not wish the policy to be renewed, or if, prior to the date of expiration, he fails to accept the offer of the insurer to renew the policy.sectionAe2Ae23 Nothing in this subsection shall apply if an affiliated insurer has manifested its willingness to provide coverage at a lower premium than would have been charged for the same exposures on the expiring policy. The affiliated insurer shall manifest its willingness to provide coverage by issuing a policy with the types and limits of coverage at least equal to those contained in the expiring policy unless the named insured has requested a change in coverage or limits. When such offer is made by an affiliated insurer, an offer of renewal shall not be required of the insurer of the expiring policy, and the policy issued by the affiliated insurer shall be deemed to be a renewal policy.sectionAe3Ae33No insurer shall cancel or refuse to renew a policy of motor vehicle insurance against legal liability of the insured as defined in § 38.2-124 insuring a business entity solely because of lack of supporting business or lack of the potential for acquiring such business.sectionBB1No reduction in coverage for personal injury or property damage liability initiated by an insurer and no insurer-initiated increase in the premium greater than 25 percent of (i) a policy of insurance defined in § 38.2-117 or 38.2-118 insuring a business entity; (ii) a policy of insurance that includes as a part thereof insurance defined in § 38.2-117 or 38.2-118 insuring a business entity; (iii) a policy of motor vehicle insurance against legal liability of the insured as defined in § 38.2-124 insuring a business entity; or (iv) a policy of miscellaneous casualty insurance as defined in subsection B of § 38.2-111 insuring a business entity, and which in the case of a reduction in coverage is subject to § 38.2-1912, shall be effective unless the insurer delivers or mails to the first named insured at the address shown on the policy, or delivers electronically to the address provided by the first named insured, a written notice of such reduction in coverage or premium increase not later than 45 days prior to the effective date of same. The increase in premium shall be the difference between the renewal premium and the premium charged by the insurer at the effective date of the expiring policy. Such notice shall:sectionCC1 Be in a type size authorized under § 38.2-311;sectionC1C12 State the date, which shall not be less than 45 days after the delivery or mailing of the notice of reduction in coverage or increase in premium, on which such reduction in coverage or increase in premium shall become effective;sectionC2C22 Advise the first named insured of the specific reason for the increase and the amount of the increase, or, if in the case of a reduction in coverage, the specific reason for the reduction and the manner in which coverage will be reduced, or that such information may be obtained from the agent or the insurer;sectionC3C32 Advise the first named insured of its right to request in writing, within 15 days of receipt of the notice, that the Commissioner of Insurance review the action of the insurer.sectionC4C42Notice of reduction in coverage or increase in premium shall not be required if:sectionEE1 The insurer, after written demand, has not received, within 45 days after such demand has been mailed or delivered to the first named insured at the address shown on the policy, or delivered electronically to the address provided by the first named insured, sufficient information from the named insured to provide the required notice;sectionE1E12 Such notice is waived in writing by the named insured;sectionE2E22 The insurer delivers or mails to the first named insured a renewal policy or a renewal offer not less than 45 days prior to the effective date of the policy or, in the case of a medical malpractice insurance policy, not less than 90 days prior to the effective date of the policy;sectionE3E32 The policy is issued to a large commercial risk as defined in subsection C of § 38.2-1903.1 but excluding policies of medical malpractice insurance; orsectionE4E42No written notice of cancellation, refusal to renew, reduction in coverage, or increase in premium that is mailed or delivered electronically by an insurer to a first named insured in accordance with this section shall be effective unless the insurer complies with the applicable provisions of subdivisions 1 through 4:sectionFF1 The notice is sent by:
sectionF1aF1a3 Registered mail;sectionF1a(1F1a(14 Certified mail; orsectionF1a(2F1a(24 Any other similar first-class mail tracking method used or approved by the United States Postal Service, including Intelligent Mail barcode Tracing (IMb Tracing); orsectionF1a(3F1a(34 The notice is sent by another method of mailing for which a certificate of mailing is obtained from the United States Postal Service at the time the notice is accepted for mailing. A certificate of mailing from the United States Postal Service does not include a certificate of bulk mailing.sectionF1bF1b3 If the notice is delivered electronically, the insurer retains evidence of electronic transmittal or receipt of the notification for at least one year from the date of the transmittal.sectionF2F22 If the notice is mailed, the insurer retains a copy of the notice of cancellation, refusal to renew, reduction in coverage, or increase in premium for at least one year from the date such action was effective. If the notice is mailed, proof of mailing from the United States Postal Service consistent with the mailing method utilized by the insurer shall be maintained for one year from the date the cancellation, refusal to renew, reduction in coverage, or increase in premium is effective.sectionF3F32 a. If the terms of a policy of motor vehicle insurance insuring a business entity require the notice of cancellation, refusal to renew, reduction in coverage, or increase in premium to be given to any lienholder, then the insurer shall mail such notice and retain a copy of the notice in the manner required by this subsection. If the notices sent to the first named insured and the lienholder are part of the same form, the insurer may retain a single copy of the notice. Proof of mailing from the United States Postal Service consistent with the mailing method utilized by the insurer shall be maintained for one year from the date the cancellation, refusal to renew, reduction in coverage, or increase in premium is effective.
sectionF4F42Nothing in this section shall prohibit any insurer or agent from including in a notice of cancellation, refusal to renew, reduction in coverage, or premium increase any additional disclosure statements required by state or federal laws.sectionGG1Every insurer shall maintain for at least one year records of cancellation, refusals to renew, reductions in coverage, and premium increases to which this section applies and copies of every notice or statement required by subsections A, C, F, and L that it sends to any of its insureds.sectionJJ1There shall be no liability on the part of and no cause of action of any nature shall arise against (i) the Commissioner of Insurance or his subordinates; (ii) any insurer, its authorized representative, its agents, or its employees; or (iii) any firm, person, or corporation furnishing to the insurer information as to reasons for cancellation, refusal to renew, reduction in coverage, or premium increase, for any statement made by any of them in complying with this section or for providing information pertaining thereto.sectionKK1