Subdivision 1. Reason for cancellation. No insurer may cancel a policy of commercial liability and/or property insurance during the term of the policy, except for one or more of the following reasons:
(1) nonpayment of premium;
(2) misrepresentation or fraud made by or with the knowledge of the insured in obtaining the policy or in pursuing a claim under the policy;
(3) actions by the insured that have substantially increased or substantially changed the risk insured;
(4) refusal of the insured to eliminate known conditions that increase the potential for loss after notification by the insurer that the condition must be removed;
(5) substantial change in the risk assumed, except to the extent that the insurer should reasonably have foreseen the change or contemplated the risk in writing the contract;
(6) loss of reinsurance by the insurer which provided coverage to the insurer for a significant amount of the underlying risk insured. A notice of cancellation under this clause shall advise the policyholder that the policyholder has ten days from the date of receipt of the notice to appeal the cancellation to the commissioner of commerce and that the commissioner will render a decision as to whether the cancellation is justified because of the loss of reinsurance within 30 business days after receipt of the appeal;
(7) a determination by the commissioner that the continuation of the policy could place the insurer in violation of the insurance laws of this state; or
(8) nonpayment of dues to an association or organization, other than an insurance association or organization, where payment of dues is a prerequisite to obtaining or continuing the insurance. This provision for cancellation for failure to pay dues does not apply to persons who are retired at 62 years of age or older or who are disabled according to Social Security standards.
Subd. 2. Notice. Cancellation under subdivision 1, clauses (2) to (8), shall not be effective before 60 days after notice to the policyholder. The notice of cancellation shall contain a specific reason for cancellation as provided in subdivision 1.
A policy shall not be canceled for nonpayment of premium pursuant to subdivision 1, clause (1), unless the insurer, at least ten days before the effective cancellation date, has given notice to the policyholder of the amount of premium due and the due date. The notice shall state the effect of nonpayment by the due date. No cancellation for nonpayment of premium shall be effective if payment of the amount due is made before the effective date in the notice.
Subd. 2a. Third-party notices. An insurer shall provide notice to a third party if:
(1) the policyholder has, separately from the certificate, notified the insurer of the identity of the third party; and
(2) the third party is a licensing authority authorized by statute to receive the notice or a state, city, or county governmental unit on whose behalf the insured is providing services.
Subd. 3. New policies. Subdivisions 1 and 2 do not apply to any insurance policy that has not been previously renewed if the policy has been in effect less than 90 days at the time the notice of cancellation is mailed or delivered. No cancellation under this subdivision is effective until at least ten days after the written notice to the policyholder.
Subd. 4. Longer-term policies. A policy may be issued for a term longer than one year or for an indefinite term with a clause providing for cancellation by the insurer for the reasons stated in subdivision 1 by giving notice as required by subdivision 2 at least 60 days before any anniversary date.
Subd. 5. Rescission. (a) No insurer may rescind or void a contract of liability or property insurance unless there was material misrepresentation, material omission, or fraud made by or with the knowledge of the insured in obtaining the contract or in pursuing a claim under the policy.
(b) No misrepresentation or omission shall be material unless knowledge by the insurer of the facts misrepresented or omitted would have led to a refusal by the insurer to make such a contract. In determining the question of materiality, evidence of the practice of the insurer with respect to the acceptance or rejection of similar risks shall be admissible.
(c) For purposes of this section, a representation is a statement as to past or present fact, made to an insurer or the insurer's agent by the applicant as an inducement for issuing a contract of commercial liability or property insurance. A misrepresentation is a false representation, and the facts misrepresented are those facts which make the representation false.
(d) This subdivision does not limit the right to cancel the policy prospectively for the reasons stated in subdivision 1, clause (2).
1987 c 337 s 24; 1994 c 485 s 13; 1996 c 446 art 1 s 7; 2010 c 384 s 7
Structure Minnesota Statutes
Chapters 59A - 79A — Insurance
Chapter 60A — General Insurance Powers
Section 60A.03 — Commissioner Of Commerce.
Section 60A.031 — Examinations.
Section 60A.032 — Commissioner's Orders, Report.
Section 60A.033 — Scheduling Conference And Order.
Section 60A.035 — Government Controlled Or Owned Company Prohibited From Transacting Business.
Section 60A.052 — Certificates Of Authority; Enforcement Actions.
Section 60A.06 — Kinds Of Insurance Permitted.
Section 60A.07 — Authorization And Requirements.
Section 60A.078 — Short Title.
Section 60A.0782 — Definitions.
Section 60A.0783 — Insurable Interest Required.
Section 60A.0784 — Prohibited Practices.
Section 60A.0785 — Prohibition; Entry Into Settlement Contracts.
Section 60A.0786 — Presumption Of Stoli Practices.
Section 60A.0787 — Processing Change Of Ownership Or Beneficiary Requests.
Section 60A.0788 — Fraudulent Acts.
Section 60A.08 — Contracts Of Insurance.
Section 60A.081 — Aircraft Insurance.
Section 60A.0811 — Breach Of Insurance Policy; Recovery Of Interest.
Section 60A.082 — Group Insurance; Benefits Continued If Insurer Changed.
Section 60A.084 — Notification On Group Policies.
Section 60A.085 — Cancellation Of Group Coverage; Notification To Covered Persons.
Section 60A.086 — Retroactive Termination Of Coverage Under Group Policies Prohibited.
Section 60A.09 — Limits Of Risk; Reinsurance.
Section 60A.091 — Definition; Qualified United States Financial Institution.
Section 60A.092 — Reinsurance Credit Allowed A Domestic Ceding Insurer.
Section 60A.0921 — Credit For Reinsurance; Certified Reinsurers.
Section 60A.095 — Reinsurance Agreements Affected.
Section 60A.096 — Qualifying Letter Of Credit.
Section 60A.097 — Qualifying Trust Agreements.
Section 60A.10 — Deposits For Protection Of Policyholders.
Section 60A.11 — Investments Permitted For Domestic Companies.
Section 60A.112 — Investment Policy Required.
Section 60A.12 — Assets And Liabilities.
Section 60A.121 — Valuations; Definitions.
Section 60A.122 — Required Written Procedures For Valuations.
Section 60A.123 — Valuation Procedure.
Section 60A.124 — Independent Audit.
Section 60A.125 — Appraisal By Independent Appraiser.
Section 60A.126 — Reports To Board; Valuations.
Section 60A.127 — Independent Appraisals Of Certain Properties.
Section 60A.1285 — Other Impairments.
Section 60A.1291 — Annual Audit.
Section 60A.1295 — Actuarial Opinion Of Reserves And Supporting Documentation.
Section 60A.1296 — Confidentiality.
Section 60A.13 — Annual Statement, Inquiries, Renewal Licenses.
Section 60A.131 — Other Business And Insurance Interests, Disclosure.
Section 60A.135 — Report; Certain Transactions.
Section 60A.136 — Acquisitions And Dispositions Of Assets.
Section 60A.137 — Nonrenewals, Cancellations, Or Revisions Of Ceded Reinsurance Agreements.
Section 60A.139 — Electronic Notices And Documents.
Section 60A.1391 — Corporate Governance Annual Disclosure.
Section 60A.16 — Mergers And Consolidations.
Section 60A.161 — Insurer Domestication And Conversion.
Section 60A.172 — Insurance Agency Contracts; Cancellation.
Section 60A.173 — Effective Date.
Section 60A.174 — Severability.
Section 60A.175 — Agent Commissions.
Section 60A.1755 — Agent Errors And Omissions Insurance; Choice Of Source.
Section 60A.176 — Definitions.
Section 60A.177 — Involuntary Termination Of An Agent By The Insurer.
Section 60A.178 — Life Or Health Insurance Sales Quotas.
Section 60A.179 — Life Or Health Insurance Sales Quotas For Exclusive Agents.
Section 60A.19 — Foreign Companies.
Section 60A.196 — Definitions.
Section 60A.197 — Rates And Forms.
Section 60A.198 — Transaction Of Nonadmitted Insurance.
Section 60A.199 — Examinations.
Section 60A.201 — Placement Of Insurance By Broker.
Section 60A.202 — Evidence Of Placement Of Insurance By Broker.
Section 60A.203 — Retention Of Records.
Section 60A.204 — Fees And Commissions.
Section 60A.205 — Compensation.
Section 60A.206 — Qualification As Eligible Surplus Lines Insurer.
Section 60A.207 — Policies To Include Notice.
Section 60A.208 — Broker Association.
Section 60A.2085 — Surplus Lines Association Of Minnesota.
Section 60A.2086 — Licensee's Duty To Submit Documents; Penalty.
Section 60A.209 — Insurance Procured From Ineligible Insurers.
Section 60A.2095 — Construction.
Section 60A.21 — Unauthorized Insurers Process Act.
Section 60A.23 — Miscellaneous.
Section 60A.236 — Stop Loss Regulation; Small Employer Coverage.
Section 60A.24 — Exemptions From Insurance Laws Of This State.
Section 60A.25 — Insolvent Companies.
Section 60A.26 — Suspension Of Insurers; Notifications And Reports.
Section 60A.27 — Discipline Of Insurer By Another State; Notice To Commissioner.
Section 60A.28 — Documents Filed With Commissioner, Verification.
Section 60A.29 — Nonprofit Risk Indemnification Trust Act.
Section 60A.315 — Expedited Form And Rate Filing.
Section 60A.32 — Rate Filing For Crop Hail Insurance.
Section 60A.351 — Renewal Of Insurance Policy With Altered Rates.
Section 60A.352 — Workers' Compensation Insurance.
Section 60A.36 — Midterm Cancellation.
Section 60A.38 — Interpretation And Penalties.
Section 60A.39 — Certificates Of Insurance.
Section 60A.41 — Subrogation Against Insureds Prohibited.
Section 60A.42 — Disability Income Coverage; Prohibited Provision.
Section 60A.52 — Company Action Level Event.
Section 60A.53 — Regulatory Action Level Event.
Section 60A.54 — Authorized Control Level Event.
Section 60A.55 — Mandatory Control Level Event.
Section 60A.57 — Access To And Use Of Rbc Information.
Section 60A.58 — Supplemental Provisions.
Section 60A.59 — Foreign Health Organizations.
Section 60A.61 — Risk-based Capital Reports.
Section 60A.62 — Company Action Level Event.
Section 60A.63 — Regulatory Action Level Event.
Section 60A.64 — Authorized Control Level Event.
Section 60A.65 — Mandatory Control Level Event.
Section 60A.67 — Confidentiality.
Section 60A.68 — Supplemental Provisions; Rules; Exemption.
Section 60A.69 — Foreign Insurers.
Section 60A.705 — Definitions.
Section 60A.715 — Required Contract Provisions; Reinsurance Intermediary-brokers.
Section 60A.72 — Books And Records; Reinsurance Intermediary-brokers.
Section 60A.725 — Duties Of Insurers Utilizing The Services Of A Reinsurance Intermediary-broker.
Section 60A.73 — Required Contract Provisions; Reinsurance Intermediary-managers.
Section 60A.735 — Prohibited Acts.
Section 60A.74 — Duties Of Reinsurer Utilizing The Services Of A Reinsurance Intermediary-manager.
Section 60A.745 — Examination Authority; Reinsurance Intermediary - Broker.
Section 60A.76 — Purpose And Scope.
Section 60A.761 — Glossary Of Technical Terms Used.
Section 60A.762 — Categories Of Reserves.
Section 60A.763 — Claim Reserves.
Section 60A.764 — Premium Reserves.
Section 60A.765 — Contract Reserves Required.
Section 60A.766 — Minimum Standards For Contract Reserves.
Section 60A.767 — Reinsurance.
Section 60A.768 — Specific Standards For Morbidity, Interest, And Mortality.
Section 60A.803 — Life And Health Reinsurance Agreements.
Section 60A.91 — Filing Requirements.
Section 60A.93 — Confidentiality.
Section 60A.94 — Revocation Of Certificate Of Authority.
Section 60A.951 — Definitions.
Section 60A.952 — Disclosure Of Information.
Section 60A.953 — Enforcement; Refusal To Cooperate With An Investigation.
Section 60A.954 — Insurance Antifraud Plan.
Section 60A.955 — Claim Forms To Contain Fraud Warning.
Section 60A.956 — Other Law Enforcement Authority.
Section 60A.957 — Definitions.
Section 60A.9572 — License And Bond Requirements.
Section 60A.9573 — License Revocation And Denial.
Section 60A.9574 — Approval Of Viatical Settlement Contracts And Disclosure Statements.
Section 60A.9575 — Reporting Requirements And Privacy.
Section 60A.9577 — Disclosure To Viator.
Section 60A.9579 — General Rules.
Section 60A.9581 — Prohibited Practices And Conflicts Of Interest.
Section 60A.9583 — Fraud Prevention And Control.
Section 60A.9585 — Unfair Trade Practice.
Section 60A.975 — Definitions.
Section 60A.976 — Annuity Issuers Financial Requirements.
Section 60A.985 — Definitions.
Section 60A.9851 — Information Security Program.
Section 60A.9852 — Investigation Of A Cybersecurity Event.
Section 60A.9853 — Notification Of A Cybersecurity Event.
Section 60A.9854 — Power Of Commissioner.
Section 60A.9855 — Confidentiality.
Section 60A.9856 — Exceptions.
Section 60A.9858 — Exclusivity.
Section 60A.99 — Interstate Insurance Product Regulation Compact.
Section 60A.991 — Interstate Insurance Product Regulation Compact Opt Out Administration.