§431:10C-111  Cancellation and nonrenewal of
policies:  when prohibited, when permitted.  (a)  An insurer may not cancel
or refuse to renew a motor vehicle insurance policy, including optional
additional insurance under the requirements of section 431:10C-302, once issued
except when:



(1)  The license of the principal operator to operate
the type of motor vehicle is suspended or revoked;



(2)  Premium payments for the policy are not made
after reasonable demand therefor;



(3)  The nonrenewal or conditional renewal is limited
in accordance with section 431:10C-111.5; or



(4)  A motor vehicle insurance policy has been in
effect for sixty days or less and cancellation of the policy is not based on
any of the criteria prohibited by subsection (c).



(b)  An insurer may refuse to renew optional
additional coverage in excess of that which the insurer is required to make
available to the insured under section 431:10C-302 where the insured is a
member of a class set forth in section 431:10C-407(b)(1)(A) or (B) at the time
of the refusal to renew.



(c)  No insurer shall refuse to continue a
motor vehicle insurance policy based solely upon a person's race, creed, ethnic
extraction, age, sex, length of driving experience, marital status, residence,
physical handicap, or because an insured has elected to obtain any required or
optional coverage or deductible required by law.  If an insured alleges that
the insurer's refusal to continue the motor vehicle insurance policy is based
solely upon the insured's race, creed, ethnic extraction, age, sex, length of
driving experience, marital status, residence, physical handicap, or because
the insured has elected to obtain any required or optional coverage or
deductible provided by law, the burden of proof shall rest with the insurer to
prove that the refusal to continue the policy was not based on noncompliance
with this subsection.



(d)  An insurer may also refuse to renew motor
vehicle insurance policies:



(1)  If the commissioner determines that the financial
soundness of the insurer would be impaired by the writing of additional
policies of insurance; or



(2)  The insurer ceases to write any new policies of
insurance of any kind in this State.



(e)  Within fifteen days of a cancellation and
the return of the motor vehicle insurance identification card or a signed
affidavit stating the card was lost or stolen, the insurer shall refund the pro
rata unearned portion, if any, of any prepaid premiums.  Premiums shall be
considered "earned" as provided in section 431:10C-109. [L 1987, c
347, pt of §2; am L 1989, c 195, §33; am L Sp 1993, c 4, §3; am L 1997, c 251,
§22; am L 2004, c 122, §40 and c 124, §1]



 



Case Notes



 



  As this section applied to insured's Hawaii joint
underwriting plan insurance policy such that insurer could not have canceled
insured's policy unless it complied with the provisions of this section,
insurer's failure to do so rendered its cancellation invalid.  105 H. 445, 99
P.3d 96.