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Perry Mogul v. Vermont Mutual Insurance Company

Held July 25, 2012 – Docket No. INS-12-2067
Decision Issued:  August 8, 2012

The named insured requested a hearing to contest the cancellation of his automobile policy for nonpayment of premium.  At hearing, the company demonstrated that no payment was received for the installment due May 28.  The company offered to continue coverage uninterrupted if payment was received before the cancellation date of June 30, but no payment was received. The insured argued that the cancellation notice and the billing invoice (which included the past due amount and the next installment due) were confusing because they were for different amounts due different dates.
Held: For the company. The Maine Automobile Insurance Cancellation Control Act allows an insurer to cancel a policy if an insured fails to make a premium payment when due. See 24-A M.R.S.A. § 2914(1). The company demonstrated that the insured was notified of the payment due prior to the due date of May 28, and did not pay it. A cancellation notice was properly issued after the premium due date, and payment was not received before the cancellation date. The company has demonstrated that the statutory requirements to cancel the policy have been met.