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Brian & Jennifer Jeffries v. State Farm Mutual Automobile Insurance Company

Held May 22, 2012– Docket No. INS-12-2035
Decision Issued:  June 5, 2012

The named insured requested a hearing to contest the cancellation of separate automobile policies due to the recent suspension of the driver’s license of one of the named insureds.  The company documented that a license suspension had occurred during the term of each of the policies.

Held:  Split Decision. For the company on the two personal automobile policies, for the insured on the recreational vehicle policy. The Maine Automobile Cancellation Control Act at 24-A M.R.S. § 2914(4) permits cancellation for the suspension of a driver’s license during the policy term; this statute applied to the two personal automobile policies. The recreational vehicle policy is governed by 24-A M.R.S. § 2908, and the company cited 2908(E)(2), which allows cancellation for a substantial breach of contractual duties, conditions, or warranties. The company argued that the license suspension was a breach of the duty to maintain a valid license. The Bureau did not find that the policy statement regarding the insured’s representation at the inception of the policy that no driver has had a license suspended in the last three years constitutes a duty, condition or warranty to maintain a license without suspension in the future.

Last Updated: April 15, 2014