Connecticut General Statutes
Chapter 700 - Property and Casualty Insurance
Section 38a-323. (Formerly Sec. 38-185w). - Notice of nonrenewal, conditional renewal and premium billing for personal and commercial risk policies.

(a)(1) No insurer shall refuse to renew any policy that is subject to the requirements of sections 38a-663 to 38a-696, inclusive, unless such insurer or its agent sends, by registered or certified mail or by mail evidenced by a certificate of mailing, or delivers to the named insured, at the address shown in the policy, or, if agreed between the insurer and the named insured, by electronic means, at least sixty days' advance notice of its intention not to renew. The notice of intent not to renew shall state or be accompanied by a statement specifying the reason for such nonrenewal. This section shall not apply: (A) In case of nonpayment of premium; (B) if the insured fails to pay any advance premium required by the insurer for renewal, provided, notwithstanding the failure of an insurer to comply with this subsection, with respect to automobile liability insurance policies the policy shall terminate on the effective date of any other insurance policy with respect to any automobile designated in both policies; or (C) if the policy is transferred from the insurer to an affiliate of such insurer for another policy with no interruption of coverage and contains the same terms, conditions and provisions, including policy limits, as the transferred policy, except that the insurer to which the policy is transferred shall not be prohibited from applying its rates and rating plans at the time of renewal. With respect to an automobile or homeowners policy, each insurer that sends or delivers a notice of nonrenewal pursuant to this subsection shall use the same method to send or deliver such notice to any third party designated pursuant to section 38a-323a.

(2) If an insurer intends to renew any policy that is subject to the requirements of sections 38a-663 to 38a-696, inclusive, under terms or conditions less favorable to the insured than provided under the existing policy, the insurer shall send a conditional renewal notice in the manner required for a notice of nonrenewal under subdivision (1) of this subsection. The conditional renewal notice shall clearly state or be accompanied by a statement clearly identifying any reduction in coverage limits, coverage provisions added or revised that reduce coverage or increases in deductibles, under the renewal policy.
(b) (1) A premium billing notice for any policy subject to the requirements of sections 38a-663 to 38a-696, inclusive, except a workers' compensation policy, shall be mailed or delivered to the insured by the insurer or its agent not less than thirty days in advance of the policy's renewal or anniversary date, except that such notice shall not be required for a commercial risk policy if the premium for the ensuing policy period is to increase less than ten per cent on an annual basis. The premium billing notice shall be based on the rates and rules applicable to the ensuing policy period and shall include a notice of transfer when the policy has been transferred from an insurer to an affiliate of such insurer pursuant to the provisions of subparagraph (C) of subdivision (1) of subsection (a) of this section. The provisions of this subsection shall apply to any such policy for which the annual premium was less than fifty thousand dollars for the preceding annual policy period.
(2) For purposes of any commercial risk policy subject to the requirements of sections 38a-663 to 38a-696, inclusive, except a workers' compensation policy, the mailing or delivery of a premium billing notice by an insurer's managing general agent, in accordance with the provisions of subdivision (1) of this subsection, shall constitute compliance by such insurer with said subdivision.
(c) Failure of the insurer or its agent to provide the insured with the required notice of nonrenewal or premium billing shall entitle the insured to: (1) Renewal of the policy for a term of not less than one year, and (2) the privilege of pro-rata cancellation at the lower of the current or previous year rates if exercised by the insured within sixty days from the renewal date or anniversary date. Renewal of a policy shall not constitute a waiver or estoppel with respect to grounds for cancellation that existed before the effective date of such renewal.
(d) Notwithstanding the provisions of subsection (b) of this section, the advance notice period for any premium billing notice shall be at least sixty days for any liability insurance policy wherein a municipality is the named insured.
(e) Notwithstanding the provisions of subdivision (1) of subsection (a) of this section, the advance notice period for any refusal to renew any professional liability policy shall be at least ninety days.
(f) (1) No surplus lines insurer shall be deemed eligible to write coverage for risks as provided in sections 38a-741 to 38a-744, inclusive, and 38a-794, unless such surplus lines insurer complies with the requirements of this section.
(2) Notwithstanding the provisions of subsection (b) of this section, premium billing notices shall be provided by any surplus lines insurer to the insured at least sixty days in advance of the renewal or anniversary date of the policy. Notices of nonrenewal or premium billing required by this section shall be provided by the surplus lines insurer or its duly authorized representative to the insured.
(3) Notwithstanding the provisions of subsection (c) of this section, failure of any surplus lines insurer to provide the insured with the required notice of nonrenewal or premium billing shall entitle the insured to an extension of the policy for a period of ninety days after the renewal or anniversary date of such policy, except that if the surplus lines insurer fails to provide the required notice on or before the renewal or anniversary date of such policy, the provisions of subsection (c) of this section shall apply. In the event of such a ninety-day extension of coverage, the premium for the extended period of coverage shall be the current rate or the previous rate, whichever is lower.
(g) For purposes of any market conduct examination performed pursuant to section 38a-15, the Insurance Commissioner may find an insurer to be in compliance with the requirements of this section upon a determination that such insurer made a good faith effort to so comply.
(P.A. 85-156, S. 1; P.A. 86-98, S. 1; P.A. 87-175, S. 1, 4; P.A. 88-82, S. 1; P.A. 96-124, S. 1, 2; P.A. 98-213; P.A. 01-113, S. 32, 42; 01-174, S. 9; P.A. 02-60, S. 5; P.A. 06-109, S. 2; P.A. 12-145, S. 6; P.A. 17-198, S. 6; P.A. 18-158, S. 12; P.A. 19-125, S. 14.)
History: P.A. 86-98 amended Subsec. (a) to increase the notice requirement for nonrenewals from 30 to 60 days, amended Subsec. (b) to increase the premium billing notice requirement from 30 to 45 days until October 1, 1987, and to broaden the applicability of the section to policies with annual premiums of less than $50,000, and added Subsec. (d) establishing a 60-day premium billing notice requirement for municipal liability insurance policies; P.A. 87-175 added Subsec. (e), making the notice requirements of the section applicable to surplus lines insurers, with certain modifications; P.A. 88-82 inserted new Subsec. (e) requiring a 90-day advance notice period for any refusal to renew any professional liability policy, relettering prior Subsecs. as necessary (this provision was formerly contained in Sec. 38-370b which was repealed by the same act); Sec. 38-185w transferred to Sec. 38a-323 in 1991; P.A. 96-124 added Subsec. (b)(2) re commercial-risk-policy billing practices, and added new Subsec. (g) re market conduct examinations to let the commissioner find compliance based on an insurer's good faith effort; P.A. 98-213 amended Subdiv. (b)(1) to create an exception from the 45-day notice requirement for commercial risk policies if the premium is to increase less than 10% on an annual basis; P.A. 01-113 amended Subsec. (f) to delete reference to Sec. 38a-795, effective September 1, 2002; P.A. 01-174 substituted reference to Sec. 38a-696 for Sec. 38a-697 in Subsecs. (a) and (b); P.A. 02-60 amended Subsec. (a) to require nonrenewal notices for an automobile or homeowners policy to be sent to any third party designated pursuant to Sec. 38a-323a, substitute “sends” for “shall send” and “delivers” for “deliver” and delete “On or after October 1, 1986”; P.A. 06-109 added Subsec. (a)(3) re exception from notice of intent not to renew requirement if policy is transferred from insurer to affiliate of insurer for another policy, and amended Subsec. (b)(1) to require premium billing notice to include notice of transfer when policy has been transferred from insurer to affiliate of insurer; P.A. 12-145 amended Subsec. (f)(1) to delete reference to Sec. 38a-777, effective June 15, 2012; P.A. 17-198 amended Subsec. (a) by designating existing provisions re insurer's refusal to renew policy as new Subdiv. (1), redesignating existing Subdivs. (1) to (3) as Subparas. (A) to (C) and adding new Subdiv. (2) re conditional renewal notice, amended Subsec. (b) by deleting provisions re mailing notice on or before September 30, 1987, deleting references to October 1, 1987, and October 1, 1998, and made technical and conforming changes; P.A. 18-158 amended Subsec. (a)(1) by adding provision re notice by electronic means, effective October 1, 2019; P.A. 19-125 changed the effective date of P.A. 18-158 from October 1, 2019, to July 1, 2019, effective July 1, 2019.
Cited. 42 CA 177.
Subsec. (a):
60-day advance notice of intent not to renew is not applicable because insurer did not want to cancel the policy through nonrenewal; insurer made an offer of renewal that was rejected because it was not accepted by payment of the renewal premium. 48 CS 460.

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