(a) This section applies only to policies of workers’ compensation insurance.
(b) A notice of nonrenewal shall be in writing and shall be delivered or mailed to the producer of record and to the named insured at the mailing address shown on the policy. Subdivision (a) of Section 1013 of the Code of Civil Procedure shall be applicable if the notice is mailed.
(c) An insurer, at least 30 days, but not more than 120 days, in advance of the end of the policy period, shall give notice of nonrenewal, and the reasons for the nonrenewal, if the insurer intends not to renew the policy.
(d) If an insurer fails to give timely notice required by subdivision (c), the policy of insurance shall be continued, with no change in its premium rate, for a period of 60 days after the insurer gives the notice.
(e) A notice of nonrenewal shall not be required in any of the following situations.
(1) The transfer of, or renewal of, a policy without a change in its terms or conditions or the rate on which the premium is based between insurers that are members of the same insurance group.
(2) The policy has been extended for 90 days or less, if the notice required in subdivision (c) has been given prior to the extension.
(3) The named insured has obtained replacement coverage or has agreed, in writing, within 60 days of the termination of the policy, to obtain that coverage.
(4) The policy is for a period of no more than 60 days and the insured is notified at the time of issuance that it may not be renewed.
(5) The named insured requests a change in the terms or conditions or risks covered by the policy within 60 days prior to the end of the policy period.
(6) The insurer has made a written offer to the insured to renew the policy at a premium rate increase of less than 25 percent.
(A) If the premium rate in the governing classification for the insured is to be increased 25 percent or greater and the insurer intends to renew the policy, the insurer shall provide a written notice of a renewal offer not less than 30 days prior to the policy renewal date. The governing classification shall be determined by the rules and regulations established in accordance with subdivision (c) of Section 11750.3.
(B) For purposes of this section, “premium rate” means the cost of insurance per unit of exposure prior to the application of individual risk variations based on loss or expense considerations such as scheduled rating and experience rating.
(Amended by Stats. 2001, Ch. 102, Sec. 4. Effective January 1, 2002.)
Last modified: October 25, 2018