CHAPTER 6. CANCELLATION OF AUTOMOBILE INSURANCE POLICIES
IC 27-7-6
Chapter 6. Cancellation of Automobile Insurance Policies
IC 27-7-6-1
Limitations on power of issuance, cancellation, and nonrenewal
Sec. 1. The issuance, cancellation, and nonrenewal of automobileinsurance policies by insurers shall be subject to the limitations setout in this chapter.
(Formerly: Acts 1969, c.332, s.1.) As amended by P.L.252-1985,SEC.263; P.L.121-1990, SEC.8.
IC 27-7-6-2
"Automobile insurance policy", "automobile liability coverage",and "policy" defined
Sec. 2. "Automobile insurance policy" means a policy deliveredor issued for delivery in this state or covering a motor vehiclerequired to be registered in this state providing coverage for bodilyinjury and property damage liability, medical payments, anduninsured motorists or any combination thereof, and insuring as thenamed insured a natural person or more than one (1) natural personsrelated to each other, resident of the same household, and underwhich the insured vehicles therein designated are as:
(a) a motor vehicle of the private passenger or station wagontype that is not used as a public or livery conveyance forpassengers, nor rented to others; or
(b) any other four-wheel motor vehicle with a load capacity ofone thousand five hundred (1,500) pounds or less which is notused in the occupation, profession, or business of the insured;provided, however, that this chapter shall not apply:
(1) to any policy issued under an automobile assigned riskplan;
(2) to any policy insuring more than four (4) automobiles; or
(3) to pay policy covering garage, automobile sales agency,repair shop, service station, or public parking placeoperation hazards.
"Automobile liability coverage" includes only coverage of bodilyinjury and property damage liability, medical payments anduninsured motorists coverage.
"Policy" shall be deemed to mean a policy providing automobileliability coverage.
(Formerly: Acts 1969, c.332, s.2.) As amended by P.L.252-1985,SEC.264.
IC 27-7-6-3
"Renewal" or "to renew" defined
Sec. 3. "Renewal" or "to renew" means the issuance and deliveryby an insurer of a policy replacing at the end of the policy period apolicy previously issued and delivered by the same insurer insuringthe same insured, or the issuance and delivery of a certificate ornotice extending the term of a policy beyond its policy period or
term; provided, however, that any policy with a policy period or termof six (6) months or less and any policy with no fixed expiration dateshall for the purposes of this chapter be considered as if written fora policy period or term of six (6) months; and provided further, thatany policy written for a term longer than one (1) year shall for thepurposes of this chapter be considered as if written for successivepolicy periods or terms of one (1) year, and such policy may beterminated by the insurer at the expiration of any annual period upongiving twenty (20) days notice of cancellation prior to suchanniversary date, and such cancellation shall not be subject to anyother provisions of this chapter.
(Formerly: Acts 1969, c.332, s.3.) As amended by P.L.252-1985,SEC.265.
IC 27-7-6-4
Notice of cancellation; authorized reasons
Sec. 4. A notice of cancellation by an insurer of an automobileinsurance policy as defined in this chapter shall be effective only ifsuch cancellation is for one (1) or more of the following reasons:
(a) Nonpayment of premium which is defined to mean for thepurposes of this chapter the failure of the named insured todischarge when due any of his obligations in connection withthe payment of premiums on a policy, or any installment of suchpremium whether the premium is payable directly to the insureror its agent or indirectly under any premium finance plan orextension of credit.
(b) The driver's license or motor vehicle registration of thenamed insured or of any other operator who either resides in thesame household or customarily operates an automobile insuredunder the policy has been denied or has been under suspensionor revocation during the policy period or the existence of one(1) or more grounds for such denial, suspension, or revocationhas become known.
(c) The named insured or any other operator who either residesin the same household or customarily operates an automobileinsured under the policy:
(1) is under treatment for epilepsy or heart disease and doesnot produce a certificate from a physician testifying to theoperator's unqualified ability to operate a motor vehiclesafely; or
(2) uses drugs or alcoholic beverages to excess.
(d) Fraud, willful misrepresentation, or concealment on the partof any insured in respect to any material fact or circumstancerelating to the issuance or continuance of the policy or relatingto a loss.
(e) Violation of any terms or conditions of the policy.
(f) The place of residence of the insured or the state ofregistration or license of the insured automobile is changed toa state or country in which the insurer is not licensed.
Provided, however, that a change or substitution in policy form shall
not be deemed to be a cancellation within the intent of this chapter;provided, further, that nothing in this section shall apply tononrenewals. This section shall not apply to any policy or coveragewhich has been in effect less than sixty (60) days at the time noticeof cancellation is mailed or delivered by the insurer unless it is arenewal policy.
(Formerly: Acts 1969, c.332, s.4.) As amended by P.L.252-1985,SEC.266.
IC 27-7-6-5
Notice of cancellation; time for mailing or delivery; notice toinsurance producer
Sec. 5. No notice of cancellation of a policy to which section 4 ofthis chapter applies shall be effective unless mailed or delivered bythe insurer to the named insured at least twenty (20) days prior to theeffective date of cancellation; provided, however, that wherecancellation is for nonpayment of premium at least ten (10) daysnotice of cancellation accompanied by the reason therefor shall begiven. In the event such policy was procured by an insuranceproducer duly licensed by the state of Indiana, notice of intent tocancel shall be mailed or delivered to the insurance producer at leastten (10) days prior to such mailing or delivery to the named insuredunless such notice of intent is or has been waived in writing by theinsurance producer. Unless the reason accompanies or is included inthe notice of cancellation, the notice of cancellation shall state or beaccompanied by a statement that upon written request of the namedinsured, mailed or delivered to the insurer not less than fifteen (15)days prior to the effective date of cancellation, the insurer willspecify the reason for such cancellation. This section shall not applyto nonrenewal.
(Formerly: Acts 1969, c.332, s.5.) As amended by P.L.252-1985,SEC.267; P.L.178-2003, SEC.45.
IC 27-7-6-6
Notice of intention not to renew; time for mailing or delivery;notice to insurance producer
Sec. 6. (a) No insurer shall fail to renew a policy unless it shallmail or deliver to the named insured, at the address shown in thepolicy, at least twenty (20) days' advance notice of its intention notto renew. In the event such policy was procured by an insuranceproducer duly licensed by the state of Indiana notice of intent not torenew shall be mailed or delivered to the insurance producer at leastten (10) days prior to such mailing or delivery to the named insuredunless such notice of intent is or has been waived in writing by theinsurance producer.
(b) This section shall not apply:
(1) if the insurer has manifested its willingness to renew; or
(2) in case of nonpayment of premium.
However, notwithstanding the failure of an insurer to comply withthis section, the policy shall terminate on the effective date of any
other insurance policy with respect to any automobile designated inboth policies.
(c) A notice of intention not to renew is not required if:
(1) the insured is transferred from an insurer to an affiliate ofthe insurer for future coverage as a result of a merger, anacquisition, or a company restructuring;
(2) the transfer results in the same or broader coverage; and
(3) the insured approves the transfer.
(d) Renewal of a policy shall not constitute a waiver or estoppelwith respect to grounds for cancellation which existed before theeffective date of such renewal.
(Formerly: Acts 1969, c.332, s.6.) As amended by P.L.160-2003,SEC.24; P.L.178-2003, SEC.46; P.L.97-2004, SEC.98.
IC 27-7-6-7
Proof of mailing notice
Sec. 7. Proof of mailing of notice of cancellation, or of intentionnot to renew or of reasons for cancellation, to the named insured atthe address shown in the policy shall be sufficient proof of notice.
(Formerly: Acts 1969, c.332, s.7.)
IC 27-7-6-8
Notice of possible eligibility under assigned risk plan
Sec. 8. When a policy providing automobile liability coverage iscancelled, other than for nonpayment of premium, or in the event offailure to renew a policy providing automobile liability coverage towhich section 6 of this chapter applies, the insurer shall notify thenamed insured of his possible eligibility for automobile liabilityinsurance through other insurers or through the automobile liabilityassigned risk plan. Such notice shall accompany or be included in thenotice of cancellation or the notice of intent not to renew.
(Formerly: Acts 1969, c.332, s.8.) As amended by P.L.252-1985,SEC.268.
IC 27-7-6-9
Compliance with request for reason for cancellation ornonrenewal; time limits
Sec. 9. Where the reason for cancellation does not accompany oris not included in the notice of cancellation, the insurer shall uponwritten request of the named insured, mailed or delivered to theinsurer not less than fifteen (15) days prior to the effective date ofcancellation, specify in writing the reason for such cancellation. Suchreason shall be mailed or delivered to the named insured within five(5) days after receipt of such request.
(Formerly: Acts 1969, c.332, s.9.)
IC 27-7-6-10
Exemption from liability for statements made in giving reasons forcancellation or nonrenewal
Sec. 10. There shall be no liability on the part of and no cause of
action of any nature shall arise against the commissioner of insuranceor against any insurer, its authorized representative, its insuranceproducers, its employees, or any firm, person, limited liabilitycompany, or corporation furnishing to the insurer information as toreasons for cancellation, for any statement made by any of them inany written notice of cancellation, or in any other communication,oral or written specifying the reasons for cancellation, or theproviding of information pertaining thereto, or for statements madeor evidence submitted at any hearings conducted in connectiontherewith.
(Formerly: Acts 1969, c.332, s.10.) As amended by P.L.8-1993,SEC.426; P.L.178-2003, SEC.47.
IC 27-7-6-11
Dispute as to truth of reason for cancellation; hearing; findings;effect; fee
Sec. 11. (a) In the event the truth of the reason or reasons forcancellation is disputed by the named insured, the insured may, notlater than ten (10) days prior to the effective date of suchcancellation, apply in writing to the commissioner of insurance fora hearing. Such application shall state wherein such reason orreasons are false and a copy of such application shall be mailed ordelivered to the insurer on the same date it is submitted to thecommissioner.
(b) If the commissioner finds that the application was made ingood faith and does in fact present a dispute as to the truth orexistence of valid grounds for cancellation, the commissioner shall,within a reasonable time after receipt of such application and uponten (10) days notice to the named insured and the insurer, hold ahearing on the matter. The findings of the commissioner shall befinal and shall be issued in writing to the parties within five (5) daysafter the hearing.
(c) In the event of a finding that no reason for cancellation in factexists, the cancellation shall be of no effect and the notice shall berescinded.
(d) In the event of a finding that one (1) or more reasons forcancellation do in fact exist, the cancellation shall be effective as ofthe date stated in the cancellation notice.
(e) No investigation, defense, or other action undertaken by theinsurer during the period between the date of cancellation stated inthe notice and the date the commissioner issued findings shall bedeemed a waiver of any rights or defenses on the part of such insurer.
(f) Any application for a hearing shall be accompanied by a filingfee of twenty dollars ($20) as a condition precedent to such hearing.Such fee shall be returned to the named insured if the finding is inthe insured's favor, but otherwise shall be retained by the departmentof insurance.
(Formerly: Acts 1969, c.332, s.11.) As amended by P.L.3-1989,SEC.154.
IC 27-7-6-12
Person with a disability; automobile policy
Sec. 12. (a) As used in this section, "person with a disability"means a person who is under a disability as defined by the federalSocial Security Administration guidelines (42 U.S.C. 416).
(b) After June 30, 1990, an insurer may not cancel, fail to renew,or refuse to issue an automobile insurance policy to a person with adisability who holds a valid driver's license solely because of thedisability, nor may an insurer cancel, fail to renew, or refuse to issuean automobile insurance policy under conditions less favorable topersons with a disability than persons without a disability.
As added by P.L.121-1990, SEC.9. Amended by P.L.99-2007,SEC.191.