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Daniel Carr IV v. Middlesex Mutual Assurance Company

Held August 1, 2013– Docket No. INS-13-2064
Decision Issued:  August 2, 2013

The insured requested a hearing to contest the cancellation of his homeowners policy for nonpayment of premium. The company did not provide sufficient notice to the insured before the cancellation and did not establish that the stated reason was included as a basis for cancellation in the policy contract.
Held: For the insured. Bureau of Insurance Rule 355 Section 7.C. requires the insurer to prove that the stated reason is both a permitted cancellation ground under 24-A M.R.S.A. § 3049 and included as a basis for cancellation under the terms of the subject policy. The company failed to provide a copy of the policy to establish its terms. Additionally, the company failed to comply with the notice requirement of section 3050. Based upon the postal proof of mailing provided by the company, the insured was given only 9 full days of notice before cancellation, not 10 days as required by § 3050. See Valley Forge Insurance Co. v. Concord Group Insurance Co., 623 A.2d 163 (Me. 1993). Additionally, the cancellation notice had offered to continue coverage if payment was received “no later than the payment due date,” identified as July 9, but then had refused the payment on July 9, asserting payment was required before the July 9 12:01 a.m. effective time of cancellation.

Last Updated: April 15, 2014