§431:10C-111  Cancellation and nonrenewal ofpolicies:  when prohibited, when permitted.  (a)  An insurer may not cancelor refuse to renew a motor vehicle insurance policy, including optionaladditional insurance under the requirements of section 431:10C-302, once issuedexcept when:

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

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

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

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

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

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

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

(1)  If the commissioner determines that the financialsoundness of the insurer would be impaired by the writing of additionalpolicies of insurance; or

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

(e)  Within fifteen days of a cancellation andthe return of the motor vehicle insurance identification card or a signedaffidavit stating the card was lost or stolen, the insurer shall refund the prorata unearned portion, if any, of any prepaid premiums.  Premiums shall beconsidered "earned" as provided in section 431:10C-109. [L 1987, c347, 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 jointunderwriting plan insurance policy such that insurer could not have canceledinsured's policy unless it complied with the provisions of this section,insurer's failure to do so rendered its cancellation invalid.  105 H. 445, 99P.3d 96.