Cancellation or Nonrenewal of Automobile or Motorcycle Policies; Procedure for Review by Commissioner

Checkout our iOS App for a better way to browser and research.

  1. This Code section shall apply only to those portions of an automobile policy or a motorcycle policy which relate to bodily injury and property damage liability, personal injury protection, medical payments, physical damage, and uninsured motorists' coverage.
  2. As used in this Code section, the term:
    1. "Policy" means a policy, or policies issued by the same insurer, insuring a natural person as named insured or one or more related individuals resident of the same household and which provides bodily injury coverage and property damage liability coverage, personal injury protection, physical damage coverage, medical payments coverage, or uninsured motorists' protection coverage or any combination of coverages and under which the insured vehicles designated in the policy are of the following types only:
      1. Any motor vehicle of the private passenger, station wagon, or jeep type or a motorcycle that is not used as a public or livery conveyance for passengers nor rented to others; or
      2. Any other four-wheel motor vehicle with a load capacity of 1,500 pounds or less which is not used in the occupation or professional business of the insured; provided, however, that this Code section shall not apply to policies of automobile liability insurance issued under the Georgia Automobile Insurance Plan nor to any policy insuring an automobile which is one of more than four insured under a single policy nor to any policy covering garage, automobile sales agency, repair shop, service station, or public parking place operation hazards.
    2. "Reduction in coverage" shall mean a change made by the insurer which results in a removal of coverage, diminution in scope or less coverage, or the addition of an exclusion. Reduction in coverage shall not include any change, reduction, or elimination of coverage made at the request of the insured. The correction of typographical or scrivener's errors or the application of mandated legislative changes shall not be considered a reduction in coverage.
    3. "Renewal" means issuance and delivery by an insurer of a policy superseding at the end of the policy period a policy previously issued and delivered by the same insurer or issuance and delivery of a certificate or notice extending the term of a policy beyond its policy period or term or the extension of the term of a policy beyond its policy period or term pursuant to a provision for extending the policy by payment of a continuation premium; provided, however, that any policy with a policy period or term of less than six months shall, for the purpose of this Code section, be considered to have successive policy periods ending each six months following its original date of issue and, regardless of its wording, any interim termination by its terms or by refusal to accept premium shall be a cancellation subject to this Code section, except in case of termination under any of the circumstances specified in subsection (f) of this Code section; provided, further, that, for purposes of this Code section, any policy written for a term longer than one year or any policy with no fixed expiration date shall be considered as if written for successive policy periods or terms of one year and any termination by an insurer effective on an anniversary date of the policy shall be deemed a refusal to renew.
  3. No notice of cancellation of a policy issued for delivery in this state shall be mailed or delivered by an insurer or its agent duly authorized to effect such cancellation, except for one or more of the following reasons:
    1. The named insured failed to discharge when due any of his obligations in connection with the payment of premiums on such policy or any installment of premiums or the renewal of premiums, whether payable directly to the insurer or indirectly to the agent. Notwithstanding the provisions of subsection (d) of Code Section 33-24-44, such notice of cancellation issued to an insured, who is paying on a monthly basis, may be included with the bill issued to the insured, provided that the bill is mailed to the insured at least ten days prior to the due date;
    2. The issuance was obtained through a material misrepresentation;
    3. Any insured violated any of the terms and conditions of the policy;
    4. The named insured failed to disclose fully, if called for in the application, his record for the preceding 36 months of motor vehicle accidents and moving traffic violations;
    5. The named insured failed to disclose in his written application or in response to inquiry by his broker or by the insurer or its agent information necessary for the acceptance or proper rating of the risk;
    6. The named insured made a false or fraudulent claim or knowingly aided or abetted another in the presentation of such a claim;
    7. The named insured or any other operator either resident in the same household or who customarily operates an automobile insured under such policy:
      1. Has, within the 36 months prior to the notice of cancellation, had his driver's license under suspension or revocation;
      2. Is or becomes subject to epilepsy or heart attacks and the individual does not produce a certificate from a physician testifying to his unqualified ability to operate a motor vehicle;
      3. Has an accident record; a conviction record, criminal or traffic; or a physical, mental, or other condition which is such that his operation of an automobile might endanger the public safety;
      4. Has within a three-year period prior to the notice of cancellation been addicted to the use of narcotics or other drugs;
      5. Has been convicted or forfeited bail during the 36 months immediately preceding the notice of cancellation for:
        1. Any felony;
        2. Criminal negligence resulting in death, homicide, or assault arising out of the operation of a motor vehicle;
        3. Operating a motor vehicle while in an intoxicated condition or while under the influence of drugs;
        4. Being intoxicated while in or about an automobile or while having custody of an automobile;
        5. Leaving the scene of an accident without stopping to report;
        6. Theft or unlawful taking of a motor vehicle; or
        7. Making false statements in an application for a driver's license; or
      6. Has been convicted of or forfeited bail for three or more violations, within the 36 months immediately preceding the notice of cancellation, of any law, ordinance, or regulation limiting the speed of motor vehicles or any of the provisions of the motor vehicle laws of any state, violation of which constitutes a misdemeanor, whether or not the violations were repetitions of the same offense or different offenses;
    8. The insured automobile:
      1. Is so mechanically defective that its operation might endanger public safety;
      2. Is used in carrying passengers for hire or compensation; provided, however, that the use of an automobile for a car pool shall not be considered use of an automobile for hire or compensation;
      3. Is used in the transportation of flammables or explosives;
      4. Is an authorized emergency vehicle; or
      5. Has changed in shape or condition during the policy period so as to increase substantially the risk.
  4. No notice of cancellation of a policy to which this Code section applies shall be effective unless mailed or delivered as prescribed in Code Section 33-24-44. The insurer shall provide the reason or reasons for such cancellation as required by Chapter 39 of this title.
    1. No insurer shall refuse to renew a policy to which this Code section applies unless a written notice of nonrenewal is mailed or delivered in person to the named insured. Such notice stating the time when nonrenewal will be effective, which shall not be less than 30 days from the date of mailing or delivery of such notice of nonrenewal or such longer period as may be provided in the contract or by statute, shall be delivered as provided in subsection (d) of Code Section 33-24-14, in person, or by depositing the notice in the United States mail to be dispatched by at least first-class mail to the last address of record of the insured and of the lienholder, where applicable, and receiving the receipt provided by the United States Postal Service or such other evidence of mailing as prescribed or accepted by the United States Postal Service.
    2. The insurer shall specify in writing the reason or reasons for such nonrenewal as required by Chapter 39 of this title.
    3. No notice refusing the renewal of a policy issued for delivery in this state shall be mailed or delivered by an insurer or its agent duly authorized to effect such notice of nonrenewal for the following reasons:
      1. Lack of, lack of potential for, or failure to agree to a writing of supporting insurance business;
      2. A change in the insurer's eligibility rules or underwriting rules, provided that this subparagraph shall not apply to a change in such rules if the change applies uniformly within a specific class or territory and such change has been approved by the Commissioner under subparagraph (B) of paragraph (4) of this subsection;
      3. With respect to any driver or with respect to any automobile or its replacement, except when the replacement is such that together with other relevant underwriting or eligibility rules it would not have been insured as an original policy risk of the insurer, for two or fewer of the following within the preceding 36 month period:
        1. Accidents involving two or more motor vehicles in which the driver of the insured automobile under this subparagraph was not at fault;
        2. Uninsured or underinsured motorist coverage claims;
        3. Comprehensive coverage claims; and
        4. Towing or road service coverage claims;
      4. Age, sex, location of residence address within the state, race, creed, national origin, ancestry, or marital status;
      5. Lawful occupation, provided that the insured automobile is not used in such occupation and provided, further, that such automobile would have been insured as an original policy risk of the insurer when such occupation is considered together with other relevant underwriting or eligibility rules of the insurer;
      6. Military service, provided that the named insured has no change of legal residence from this state;
      7. Number of years of driving experience of a named insured or of any other operator who is either a resident in the same household or customarily an operator of an automobile insured under such policy;
      8. Accidents or violations which occurred more than 36 months prior to the expiration date or anniversary date of the policy or solely for claims paid or payable pursuant to the policy during the preceding 36 month period which did not aggregate in an amount in excess of $750.00;
      9. One claim against the policy based on fault if such coverage has been in effect continuously for at least 36 preceding months;
      10. Notwithstanding subparagraph (I) of this paragraph, two claims against the policy based on fault if such coverage has been in effect continuously for at least 72 preceding months; and
      11. Factors not relating to the claims record, driving record, or driving ability of the named insured or of any other operator who is either a resident in the same household or customarily an operator of an automobile insured under such policy.
      1. Notwithstanding paragraph (3) of this subsection, any reason set forth in subsection (c) of this Code section, relating to cancellation, shall also constitute a reason for nonrenewal.
      2. If the insurer demonstrates to the satisfaction of the Commissioner that renewal would violate the provisions of this title or would be hazardous to its policyholders or the public, subparagraph (B) or (K) of paragraph (3) shall not apply.
      1. If the insurer complies with paragraph (1) of this subsection, no claim or action may be maintained with respect to a policy which is not renewed unless the named insured files a written notice with the insurer before the time at which nonrenewal becomes effective. The notice shall specify the manner in which the failure to renew is alleged to be unlawful under this subsection. In any subsequent action asserting a violation of this subsection, no violation of this subsection may be alleged other than the specific allegations contained in the notice filed by the named insured.
      2. In addition to other requirements, a notice of nonrenewal shall contain the provisions of subparagraph (A) of this paragraph, in substantially the form which follows:

        If you do not file the written notice, you may not later assert a claim or action against this insurer based upon an unlawful nonrenewal."

      1. Notwithstanding paragraph (3) of this subsection, the termination of an agency relationship shall be valid as a reason for a failure to renew a policy. In such case, if the named insured wishes to retain the policy with the particular insurer, the insured shall locate another agent of the insurer and apply for the policy with another agent of the insurer before the time at which the nonrenewal becomes effective. Upon receipt of the application, the insurer shall treat the application as a renewal and not as an original writing. Nothing in this subparagraph shall abridge or supersede contractual rights of the terminated agency or the insurer, provided that these contractual rights do not adversely affect the privilege of the named insured to apply for renewal through another agent of the insurer.
      2. A notice of nonrenewal based upon the termination of an agency relationship shall contain the provisions of subparagraph (A) of this paragraph, in substantially the form which follows:
  5. Subsection (e) of this Code section shall not apply in case of:
    1. Nonpayment of premium for the expiring policy;
    2. Failure of the insured to pay the premium as required by the insurer for renewal;
    3. The insurer having manifested its willingness to renew by delivering a renewal policy, renewal certificate, or other evidence of renewal to the named insured or his or her representative or by offering to issue a renewal policy, certificate, or other evidence of renewal or having manifested such intention by any other means; or
    4. A reduction in coverage where an insurer provides a written notice of a reduction in coverage to the named insured or his or her representative no less than 30 days prior to the effective date of the proposed reduction in coverage; provided that such notice shall be in a separate document with the words "NOTICE OF REDUCTION IN COVERAGE" written in all capital letters in at least 12 point type. Such notice shall be delivered as provided in subsection (d) of Code Section 33-24-14, in person, or by depositing the notice in the United States mail to be dispatched by at least first-class mail to the last address of record of the insured and receiving the receipt provided by the United States Postal Service or such other evidence of mailing as prescribed or accepted by the United States Postal Service.
  6. Notwithstanding the failure of an insurer to comply with this Code section, termination of any coverage under the policy either by cancellation or nonrenewal shall be effective on the effective date of any other policy providing similar coverage on the same motor vehicle or any replacement of coverage.
  7. Renewal or continuation of a policy shall not constitute a waiver or estoppel with respect to ground for cancellation which existed before the effective date of the renewal or continuance.
  8. When a policy is canceled other than for nonpayment of premium or in the event of a refusal to renew or continue a policy, the insurer shall notify the named insured of his possible eligibility for insurance through the Georgia Automobile Insurance Plan. Such notice shall accompany or be included in the notice of cancellation or the notice of intent not to renew or not to continue the policy and shall state that such notice of availability of the Georgia Automobile Insurance Plan is given pursuant to this Code section.
  9. There shall be no liability on the part of and no cause of action of any nature shall arise against the Commissioner or his employees or against any insurer, its authorized representatives, its agents, its employees, or any firm, person, or corporation furnishing to the insurer information as to reasons for cancellation or nonrenewal for any statement made by any of them in any written notice of cancellation or nonrenewal or in any other communication, oral or written, specifying the reasons for cancellation or nonrenewal or providing information pertaining to the reasons for cancellation or nonrenewal or for statements made or evidence submitted at any formal or informal hearing conducted in connection with the reasons for cancellation or nonrenewal of the insured's policy.
  10. This Code section shall not apply to any policy which has been in effect less than 60 days at the time notice of cancellation is mailed or delivered by the insurer unless it is a renewal of a policy. Such policies shall be canceled in accordance with Code Section 33-24-44.
  11. Return of unearned premium, if any, due to cancellations as to which this Code section applies shall be processed in accordance with Code Section 33-24-44.
  12. Notice to the insured shall not be required by this Code section when a policy is canceled by an insurance premium finance company under a power of attorney contained in an insurance premium finance agreement if notification of the existence of the premium finance agreement has been given to the insurer in accordance with the provisions of Chapter 22 of this title. However, the insurer shall comply with the provisions of subsection (d) of Code Section 33-22-13 pertaining to notice to a governmental agency, mortgagee, or other third party. Such notice shall be delivered as provided in subsection (d) of Code Section 33-24-14, in person, or by depositing the notice in the United States mail to be dispatched by at least first-class mail to the last address of record of such governmental agency, mortgagee, or other third party and receiving the receipt provided by the United States Postal Service or such other evidence of mailing as prescribed or accepted by the United States Postal Service.
  13. Cancellation by the insured shall be accomplished as provided in Code Section 33-24-44.1.
  14. An insured may request a review by the Commissioner if the insured believes that his or her policy has been canceled or nonrenewed in violation of this Code section. Such request must be filed with the Commissioner within 15 days of receipt of a notice of cancellation or nonrenewal. A review of the cancellation or nonrenewal shall be conducted within 30 days of said request. The Commissioner shall notify the insured and the insurer of his or her decision within the 30 day period. During the pendency of such review, the policy shall continue in full force and effect and the Commissioner shall specify by rule or regulation the method of payment of premium due and the disposition of premium refunds, if any. The Commissioner shall either require that the policy be reinstated or renewed or may uphold the nonrenewal or cancellation. In the event the Commissioner determines that an insurer's cancellation or nonrenewal action constitutes an unfair act or practice, the Commissioner may take action as authorized by this title. Following the completion of any review provided by this subsection, an insured may request a hearing pursuant to Code Section 33-2-17, and nothing in this subsection shall be deemed to waive an insured's right to request such a hearing.

- Pursuant to Code Section 28-9-5, in 1985, in subsection (b), paragraph (1) was redesignated as paragraph (2) and paragraph (2) was redesignated as paragraph (1) in order to arrange the defined terms in alphabetical order.

Editor's notes.

- Ga. L. 1991, p. 1608, § 3.1, not codified by the General Assembly, provides that this Code section shall apply to policies of motor vehicle insurance issued, issued for delivery, delivered, or renewed on and after October 1, 1991. Except for an otherwise permissible cancellation of policy of motor vehicle insurance, coverages payable without regard to fault in motor vehicle insurance policies in existence on October 1, 1991, shall remain in effect until changed by specific request of the policyholder and reflected by endorsement to the policy or until the renewal date of the policy; provided, however, the insurer shall be required to send written notice to the policyholder of any changes in coverage to be effective upon renewal of the policy as a result of this Act not less than 60 days prior to the renewal date of the policy. Written notice to the policyholder shall be accomplished in such form and manner as prescribed by the Commissioner of Insurance.

Law reviews.

- For article surveying Georgia cases in the area of insurance from June 1979 through May 1980, see 32 Mercer L. Rev. 79 (1980). For annual survey of insurance law, see 35 Mercer L. Rev. 177 (1983). For annual survey of insurance law, see 42 Mercer L. Rev. 259 (1990). For annual survey on insurance law, see 69 Mercer L. Rev. 117 (2017). For review of 1996 department and commissioner of insurance legislation, see 13 Ga. St. U.L. Rev. 183. For comment on Life Ins. Co. v. Bartlett, 37 Ga. App. 22, 138 S.E. 589 (1927), see 1 Ga. L. Rev. No. 2 P. 49 (1927).

JUDICIAL DECISIONS

ANALYSIS

  • General Consideration
  • Exceptions
  • Effectiveness of Notice
  • Insurance Agents
General Consideration

Purpose of this section is to provide an insured with notice as to the status of the insured's policy, and when the record affirmatively shows compliance with this section by the insurer, knowledge of the policy's status, and admitted inactivity and nonresponse by the insured to effect a renewal thereof, the law should not create a contractual relationship due to after-the-fact circumstances. National Indem. Co. v. Berry, 136 Ga. App. 545, 221 S.E.2d 624 (1975).

Terms of this section as to cancellation must be exactly followed. Garber v. American Mut. Fire Ins. Co., 131 Ga. App. 366, 206 S.E.2d 86 (1974).

Applicant's misrepresentation.

- Regardless of whether the applicant made material misrepresentations on the applicant's application, the applicant's policy with the insurer remained enforceable; the insurer cited no case, and the appellate court found none, that would allow an insurer to void an automobile insurance policy affording third-party liability protection without utilizing the statutory procedures mandated by O.C.G.A. § 33-24-45. Liberty Ins. Corp. v. Ferguson, 263 Ga. App. 714, 589 S.E.2d 290 (2003).

Strict adherence to this section, in regard to automobile insurance policies, is required to accomplish cancellation. American Int'l Life Ins. Co. v. Hartsfield, 147 Ga. App. 213, 248 S.E.2d 518 (1978).

This section provides for automatic renewal of automobile liability coverage unless the company meets notice requirements therein set forth. Unigard Mut. Ins. Co. v. Fox, 142 Ga. App. 706, 236 S.E.2d 851 (1977).

1988 amendment not applied retroactively.

- The 1988 amendment, which added division (e)(3)(C)(i) so as to prevent nonrenewal except under stated conditions, is not applied retroactively. Banks v. Aetna Cas. & Sur. Co., 189 Ga. App. 758, 377 S.E.2d 685 (1989).

Written notice required to effect cancellation of policy which protects interest of lienholder. Pennsylvania Millers Mut. Ins. Co. v. Employers' Fire Ins. Co., 118 Ga. App. 655, 165 S.E.2d 309 (1968).

O.C.G.A. § 33-24-7 does not apply to insurance policies covered by O.C.G.A. § 33-24-45. Sentry Indem. Co. v. Sharif, 248 Ga. 395, 282 S.E.2d 907 (1981); Georgia Farm Bureau Mut. Ins. Co. v. Phillips, 251 Ga. 244, 304 S.E.2d 725 (1983).

"Renewal" means renewal of the terms of the original policy; when the original policy is for six months, the renewal period must be the same. Wisener v. American S. Ins. Co., 150 Ga. App. 795, 258 S.E.2d 908 (1979).

Mandatory minimum and optional amounts of coverage.

- Paragraph (b)(1) (formerly paragraph (b)(2)) of O.C.G.A. § 33-24-45 does not distinguish between mandatory minimum and optional amounts of coverage. Georgia Farm Bureau Mut. Ins. Co. v. Phillips, 251 Ga. 244, 304 S.E.2d 725 (1983).

Applicability of subsection (g).

- Under the terms of the insured's homeowners' policy and consistent with subsection (g) of O.C.G.A. § 33-24-45, an insured effected a termination of the auto insurance endorsement to the insured's homeowners' policy when the insured procured an auto insurance policy from another company. Cincinnati Ins. Co. v. St. Paul Fire & Marine Ins. Co., 222 Ga. App. 190, 474 S.E.2d 78 (1996).

Applicability of subsection (i).

- While it would appear that subsection (i) (formerly subsection (j)) of this section was intended to apply when the policy was either canceled or not renewed because the insurance company felt that the insured was a poor risk, this section does not so provide but in fact makes subsection (i) (formerly subsection (j)) apply in all cases when the policy is canceled or not renewed. Concord Group Ins. Co. v. Terry, 130 Ga. App. 13, 202 S.E.2d 471 (1973).

Subsection (i) (formerly subsection (j)) of O.C.G.A. § 33-24-45, which provides for the notification of the insured of the insured's possible eligibility for insurance in the Georgia Automobile Assigned Risk Plan (now Georgia Automobile Insurance plan), only comes into play when a notice of intention not to renew under subsection (e) must be given. Notice need not be given when "the insurer . . . manifested its willingness to renew . . ." under paragraph (f)(3). Wheeler v. Standard Guar. Ins. Co., 168 Ga. App. 565, 309 S.E.2d 805 (1983).

Failure to follow statutory requirements resulting in noncancellation and renewal of policy.

- Insurer's notice which failed to provide 30 days' notice of cancellation and failed to state a valid reason for cancellation resulted in noncancellation of a policy and, because no notice of nonrenewal was given, the policy was extended under the policy's terms for another six months. Bank of Toccoa v. Cotton States Mut. Ins. Co., 211 Ga. App. 389, 439 S.E.2d 60 (1993).

Notice of willingness to renew may be given simultaneously with issuance of policy. Wheeler v. Standard Guar. Ins. Co., 168 Ga. App. 565, 309 S.E.2d 805 (1983).

Notice required for cancellation of policy for nonpayment of premiums.

- Automobile insurance policy as to bodily injury and property damage liability, medical payments, physical damage, and uninsured motorists coverage is controlled by this section, specifically as to cancellations, and notice is required to cancel for nonpayment of premiums, or any installment thereof. American Int'l Life Ins. Co. v. Hartsfield, 147 Ga. App. 213, 248 S.E.2d 518 (1978).

Policy automatically renewed absent compliance with section.

- Policy is automatically renewed in the event of failure on the part of the insurer to mail the required notice of intention not to renew, or to comply with subsections (e) through (h) of this section. Garner v. GEICO, 129 Ga. App. 235, 199 S.E.2d 350 (1973).

Mailing alone of notice of willingness or intent to renew, if unreceived, does not constitute an offer to the insured to renew so as to prevent the automatic renewal of the policy. Garner v. GEICO, 129 Ga. App. 235, 199 S.E.2d 350 (1973).

If the insurer does not properly comply with the notice requirements of O.C.G.A. § 33-24-45, then the insured's policy is automatically renewed. Georgia Mut. Ins. Co. v. Mims, 187 Ga. App. 783, 371 S.E.2d 426, cert. denied, 187 Ga. App. 907, 371 S.E.2d 426 (1988).

Insured's automobile liability policy automatically renewed under O.C.G.A. § 33-24-45(e) when the insurer did not send the insurer's renewal declaration statement until three days after the date on which the policy expired and, thus, the insured had coverage on the insured's automobile at the time of the accident one month after the expiration and automatic renewal occurred. Stedman v. Cotton States Ins. Co., 254 Ga. App. 325, 562 S.E.2d 256 (2002).

Renewal versus new policy.

- Because an insurance policy was issued by the same insurer to supersede an existing policy and to extend the term of the existing policy beyond its policy period conditioned upon payment of a continuation premium, the fact that the policy bore a slightly different number and that there were changes in the premium amounts and the vehicles insured did not mean that the policy was a new policy rather than a renewal under O.C.G.A. § 33-24-45(b)(2) (now paragraph (b)(3)). Thus, uninsured motorist coverage was not the $1,000,000 liability limit under O.C.G.A. § 33-7-11(a), but the $25,000 per person limit that the insureds had previously selected. Roberson v. Leone, 315 Ga. App. 459, 726 S.E.2d 565 (2012).

Effect of lapse between expiration of existing policy and issuance of new policy.

- Lapse of two days between the expiration of the existing policy and the issuance of another policy does not preclude the second policy from being a renewal contract. A renewal policy can begin on another date by agreement of the parties to the contract. Progressive Preferred Ins. Co. v. Brown, 261 Ga. 837, 413 S.E.2d 430 (1992).

Effect of insurer's practice of renewing policy "without interruption."

- When the custom and practice between an insurer and an insured was that the insurer would renew the policy "without interruption" upon receipt of late premiums, an issue arose as to whether, as a result of a quasi-new agreement created by the past conduct of the parties, the policy was reinstated following such cancellation. Holland v. Allstate Ins. Co., 200 Ga. App. 668, 409 S.E.2d 79 (1991).

Effect of redepositing dishonored check.

- Insurance company does not accept a premium check as absolute payment when the company promptly presents a dishonored check a second time for collection. Accordingly, the insurer did not waive the insurer's right to treat the insured's check as a conditional payment by redepositing the check after the check's initial dishonor. Progressive Preferred Ins. Co. v. Brown, 261 Ga. 837, 413 S.E.2d 430 (1992).

Mailed cancellation proper for DUI violation.

- Information that the driver's license of a driver recently added to the policy had recently been suspended because of a DUI violation was clearly necessary for a proper risk evaluation, according to subsection (c) of O.C.G.A. § 33-24-45, sufficient to cancel via mailed notice. Ramsdell v. State Auto Mut. Ins. Co., 206 Ga. App. 357, 425 S.E.2d 661 (1992).

Caveat providing for no grace period not against public policy.

- Caveat in month to month insurance plan stating "No grace period! If premium is not received by due date your coverage expires" is governed by the exceptions enumerated in subsections (e) through (g) of O.C.G.A § 33-24-45 and is not offensive to the general welfare of the public. Whitlock v. Dairyland Ins. Co., 160 Ga. App. 113, 286 S.E.2d 343 (1981).

Payment of renewal premium must be to insurer's agent.

- When there was a payment by the plaintiff, as evidenced by a receipt to the plaintiff from an insurance broker, for the minimum payment requested in the notice after the expiration date, the policy had expired and there was no coverage unless one of the insurance brokers was acting as agent for the insurer so that the payment to one of the agents would constitute payment to insurer. National Property Owners Ins. Co. v. Wells, 166 Ga. App. 281, 304 S.E.2d 458 (1983).

Effect of payment made after cancellation.

- While insureds made a payment after sustaining auto damage and after allegedly learning for the first time that the insureds' coverage had been cancelled for non-payment, the insurer's receipt of this payment resulted in the reinstatement of the policy the following day. Thus, the insureds' intent in making payment after the fact was irrelevant to whether the insureds' policy was cancelled at the time of the accident. Burnside v. GEICO Gen. Ins. Co., 309 Ga. App. 897, 714 S.E.2d 606 (2011).

Cited in Employers' Fire Ins. Co. v. Pennsylvania Millers Mut. Ins. Co., 116 Ga. App. 433, 157 S.E.2d 807 (1967); International Serv. Ins. Co. v. Consolidated Underwriters, 125 Ga. App. 786, 189 S.E.2d 123 (1972); Atlanta Cas. Co. v. Williams, 135 Ga. App. 562, 218 S.E.2d 282 (1975); Roberts v. American S. Ins. Co., 142 Ga. App. 232, 235 S.E.2d 660 (1977); Peek v. Southern Guar. Ins. Co., 240 Ga. 498, 241 S.E.2d 210 (1978); Howard v. American S. Ins. Co., 148 Ga. App. 25, 251 S.E.2d 7 (1978); Pearce v. Southern Guar. Ins. Co., 246 Ga. 33, 268 S.E.2d 623 (1980); Smith v. Allstate Ins. Co., 573 F. Supp. 707 (N.D. Ga. 1983); Lyles v. Fire & Cas. Ins. Co., 179 Ga. App. 425, 346 S.E.2d 585 (1986); Stegall v. Leader Nat'l Ins. Co., 256 Ga. 765, 353 S.E.2d 484 (1987); Leader Nat'l Ins. Co. v. Gaydon, 185 Ga. App. 322, 363 S.E.2d 859 (1987); Borders v. Global Ins. Co., 208 Ga. App. 480, 430 S.E.2d 854 (1993); Infinity Gen. Ins. Co. v. Litton, 308 Ga. App. 497, 707 S.E.2d 885 (2011); McGraw v. IDS Prop. & Cas. Ins. Co., 323 Ga. App. 408, 744 S.E.2d 891 (2013).

Exceptions

Cancellation provisions apply only to natural persons and did not apply to a policy covering corporate insureds. Capital City Ins. Co. v. Rick Taylor Timber Co., 918 F. Supp. 1558 (S.D. Ga. 1995), aff'd, 106 F.3d 417 (11th Cir. 1997).

Subsection (k) (formerly subsection (i)) eliminates the requirement of notice to the insured if the policy has been in effect for less than 60 days. Sentry Indem. Co. v. Sharif, 248 Ga. 395, 282 S.E.2d 907 (1981).

Notice of intention not to renew requirement when corporate insured.

- Justification for imposing the additional burden of a written notice of intention not to renew upon the insurer under subsection (e) of O.C.G.A. § 33-24-45 may not be present when the insured is a corporation rather than an individual. Disparate treatment of an individual and corporate insureds is not a violation of equal protection in that it bears a real relation to the object of the legislation, which is to protect unsophisticated and more likely unwary insureds by assuring that insurance remains in effect. Home Materials, Inc. v. Auto Owners Ins. Co., 250 Ga. 599, 300 S.E.2d 139 (1983).

No notice required when premium not paid.

- When an insured failed to pay a premium for renewal coverage following the insurer's manifestation of the insurer's willingness to renew, no written notice of nonrenewal was required to terminate coverage. Smith v. Southeastern Fid. Ins. Co., 171 Ga. App. 26, 318 S.E.2d 708 (1984).

Cancellation for nonpayment of premiums is within the purview of subsection (f) of O.C.G.A. § 33-24-45 and without the purview of subsection (e) of O.C.G.A. § 33-24-45. Southern Gen. Ins. Co. v. Gailey, 168 Ga. App. 102, 308 S.E.2d 219 (1983).

Cancellation is allowed for any reason of policy "which has been in effect less than 60 days at the time notice of cancellation is mailed or delivered by the insurer unless it is a renewal of a policy." Georgia Mut. Ins. Co. v. Ragan, 122 Ga. App. 56, 176 S.E.2d 230 (1970).

Effectiveness of Notice

Insurer's intent not to renew cannot act to bar automatic renewal of the policy unless that intent to renew is communicated to and received by the insured prior to the expiration date of the policy. Prudential Property & Cas. Ins. Co. v. Pritchett, 169 Ga. App. 564, 313 S.E.2d 706 (1983).

Notice ineffective as notice of cancellation.

- Notice of cancellation which states that a policy will be cancelled on a specified date unless premiums due are paid prior to that date is merely a demand for payment and ineffective as a notice of cancellation. Pennsylvania Nat'l Mut. Cas. Ins. Co. v. Person, 164 Ga. App. 488, 297 S.E.2d 80 (1982).

When notice of cancellation was not given to the insured upon the insured's failure to pay the premium when due, but rather, was given before the premium was due, there was a failure to adhere to statutory requirements resulting in noncancellation of the policy. Pennsylvania Nat'l Mut. Cas. Ins. Co. v. Person, 164 Ga. App. 755, 297 S.E.2d 337 (1982).

Regardless of when it was generated, under O.C.G.A. § 33-24-45(d), an auto insurer's cancellation notice could not take effect until the date of mailing, at which point the insurer had received payment satisfying the insured's past-due balance. Therefore, cancellation for non-payment was improper under O.C.G.A. § 33-24-44. Auto-Owners Ins. Co. v. Alexander, 293 Ga. App. 459, 667 S.E.2d 628 (2008).

Written notice ineffective prior to loss.

- When written notice of cancellation of a policy would not have been effective prior to the occurrence of the property loss, any actual notice could not have accomplished a prior cancellation and the policy was still in effect at the time of the loss. Pennsylvania Millers Mut. Ins. Co. v. Employers' Fire Ins. Co., 118 Ga. App. 655, 165 S.E.2d 309 (1968).

No cancellation when evidence failed to show mail contained notice to insured.

- When the evidence adduced failed to show that the mail addressed to the insured and receipted for by the United States Post Office contained the notice of cancellation of the policy as required under O.C.G.A. §§ 33-24-44 and33-24-45, no cancellation was effected in the absence of a showing of actual receipt of the cancellation notice by the insured. Allstate Ins. Co. v. Cody, 123 Ga. App. 265, 180 S.E.2d 596 (1971).

Notice effective.

- In response to a certified question, the Georgia Supreme Court held that a cancellation notice, given after an insurance premium was past due, which clearly stated that cancellation was occurring, was not ineffective under O.C.G.A. § 33-24-45(c)(1) simply because it also provided the insured with an opportunity to reinstate coverage. Reynolds v. Infinity Gen. Ins. Co., 287 Ga. 86, 694 S.E.2d 337 (2010).

Insurer's evidence establishing that on the same date of the mailing receipt, the insureds were sent a cancellation notice, and that it was the insurer's practice to have cancellation notices inserted into envelopes manually or by machine before being matched to the appropriate mailing receipt, was sufficient to establish that the mailing contained a notice of cancellation sent to the insureds. Burnside v. GEICO Gen. Ins. Co., 309 Ga. App. 897, 714 S.E.2d 606 (2011).

Because the mailing receipt and other uncontradicted evidence showed that the requisites of O.C.G.A. §§ 33-24-44 and33-24-45(c) were satisfied, whether the insureds actually received notice of cancellation of the insureds auto insurance policy was irrelevant and did not preclude the insurer from cancelling the insureds' policy due to non-payment. Burnside v. GEICO Gen. Ins. Co., 309 Ga. App. 897, 714 S.E.2d 606 (2011).

Insurance Agents

Standing lies in policyholders.

- Insurance agent had no claim for negligence against an insurer based on the insurer's cancellation of policies since such a claim could be asserted only by the policyholders. Keith v. Alexander Underwriters Gen. Agency, Inc., 226 Ga. App. 838, 487 S.E.2d 673 (1997).

Insurance brokers not normally insurer's agents.

- While insurance agents or brokers may be considered as "dual" agents, or agents for both the insurer and the insured, normally such insurance representatives are independent insurance brokers and are the insured's agents, not those of the insurer. National Property Owners Ins. Co. v. Wells, 166 Ga. App. 281, 304 S.E.2d 458 (1983).

Denial of agency sufficient to support insurer's motion for judgment.

- Since an assertion or denial of the existence of an agency relationship is a statement of fact when made by one of the purported parties, such a statement may not be disregarded by the trial court and is sufficient to support a motion for summary judgment; and an affidavit of insurer's officer categorically denying that insurance brokers were its agents effectively pierces the insured's pleadings and places on the insured the burden of showing the fact of agency. National Property Owners Ins. Co. v. Wells, 166 Ga. App. 281, 304 S.E.2d 458 (1983).

Insurance agent has right to bring action in agent's own name for unpaid premium when, on behalf of the insured, the agent has paid the premium to the insurer or, although the agent has not paid the premium, the agent has become personally liable for the premium's payment. Spalding Ins. & Realty Co. v. Morris, 154 Ga. App. 869, 270 S.E.2d 78 (1980).

RESEARCH REFERENCES

Am. Jur. 2d.

- 7 Am. Jur. 2d, Automobile Insurance, § 50 et seq. 43 Am. Jur. 2d, Insurance, § 378 et seq.

C.J.S.

- 44 C.J.S., Insurance, § 403 et seq.

ALR.

- Delay of remittance in mail as affecting forfeiture or loss of rights through nonpayment, 1 A.L.R. 677.

Provision suspending insurance during default in payment of premiums or assessments as affected by failure of insurer to declare a suspension before loss, 8 A.L.R. 395.

Insurance against theft of automobile, 19 A.L.R. 171.

Insurance: guaranty fund as preventing forfeiture for nonpayment of premiums or assessments, 29 A.L.R. 517.

Contract providing that obligation thereof shall be canceled in case of death or other extrinsic event as contract of insurance, 35 A.L.R. 1039; 63 A.L.R. 711; 100 A.L.R. 1449; 119 A.L.R. 1241.

Practice of taking notes for premiums as waiver of requirement of payment as to premium for which note not given, 53 A.L.R. 915.

Validity of provision avoiding insurance if insured has been treated for any serious disease or complaint, 60 A.L.R. 198.

Exercise of reserved right to cancel policy of insurance as affected by motive or reason for cancellation, 68 A.L.R. 1171.

Action of insurer in regard to unpaid premium note after maturity as waiver of, or estoppel to claim, forfeiture for nonpayment, 83 A.L.R. 846.

Increase in insurance rates or loss of opportunity to obtain insurance in consequence of another's tort as ground of liability, 92 A.L.R. 1205.

Antedating policy of insurance as affecting liability for loss that had already occurred, 132 A.L.R. 1325.

Notice to insured of insufficiency to meet premiums of cash or loan value, reserve, or dividends, 140 A.L.R. 683.

Insurance: incorrect statement of age, 160 A.L.R. 295.

Wrongful termination of policy by insurer, or false information to insured in that regard, as excusing further tend and payment of premiums or assessments, 160 A.L.R. 629.

Independent investigation by insurer as affecting its right to avoid policy because of misrepresentations in application, 169 A.L.R. 361.

Construction and application of provision of statute designed to prevent avoidance of automobile liability policy by reason of violation of its exclusions or conditions, or other terms, 1 A.L.R.2d 822.

Limitations governing action to recover unearned premium retained by insurer upon cancellation of policy, 29 A.L.R.2d 938.

Misrepresentation by applicant for automobile liability insurance as to ownership of vehicle as material to risk, 33 A.L.R.2d 948.

Delivery to insured of receipt showing premium payment as bar to, or waiver or estoppel of, insurer's right to terminate automobile insurance for nonpayment of premium, 48 A.L.R.2d 1094.

Time for payment of insurance premium where last day falls on Sunday or holiday, 53 A.L.R.2d 877.

Automobile property insurance: sole, unconditional, or absolute ownership clause, 71 A.L.R.2d 223.

Automobile liability insurance: sole, unconditional, or absolute ownership clause, 71 A.L.R.2d 267.

Insurer's liability under accident policy which terminated after accidental injury but prior to completion of medical treatment, hospitalization, and the like, 75 A.L.R.2d 876.

Rescission or avoidance, for fraud or misrepresentation, of compulsory, financial responsibility, or assigned risk automobile insurance, 83 A.L.R.2d 1104.

Insurer's denial of renewal of policy: waiver and estoppel, 85 A.L.R.2d 1410.

Materiality of false statements by applicant for automobile insurance as to license revocations or suspensions or traffic violations, 89 A.L.R.2d 1027.

Insurance company as bound by greater coverage in earlier policy where renewal policy is issued without calling to insured's attention a reduction in the policy coverage, 91 A.L.R.2d 535.

Effect of attempt to terminate insurance or fidelity contract upon notice allowing a shorter period than that stipulated in contract, 96 A.L.R.2d 286.

Insurer's acceptance of defaulted premium payment or defaulted payment on premium note, as affecting liability for loss which occurred during period of default, 7 A.L.R.3d 414.

Dividends as preventing lapse of policy for nonpayment of premiums, 8 A.L.R.3d 862.

Insured's cooperation with claimant in establishing valid claim against insurer as breach of cooperation clause, 8 A.L.R.3d 1345.

Construction of express insurance policy provision restricting insurer's right to cancel or otherwise terminate coverage, 19 A.L.R.3d 1429.

Insured's misrepresentation or misstatement as to his name or marital status as ground for avoiding liability insurance, 27 A.L.R.3d 849.

Remedies and measure of damages for wrongful cancellation of life, health, and accident insurance, 34 A.L.R.3d 245.

Remedies and measure of damages for wrongful cancellation of liability and property insurance, 34 A.L.R.3d 385.

Automobile insurance: concealment or nondisclosure of physical defects or conditions as avoiding coverage, 72 A.L.R.3d 804.

Insured's right of action for arbitrary nonrenewal of policy, where insurer has option not to renew, 37 A.L.R.4th 862.

Actual receipt of cancellation notice mailed by insurer as prerequisite to cancellation of insurance, 40 A.L.R.4th 867.

Cancellation of compulsory or "financial responsibility" automobile insurance, 44 A.L.R.4th 13.


Download our app to see the most-to-date content.