California Extends Notice of Nonrenewal Requirements on Certain Lines of Insurance

On October 12, 2019, California Governor Gavin Newsom signed Assembly Bill 1816 into law. Among other changes to the Code, AB 1816 amends Cal. Ins. Code § 678 to require insurers to provide at least 75 days’ notice before sending a notice of non-renewal of a policy which provides coverage for real property used primarily for residential purposes (homeowners), personal property in which residents of the real property have an interest and legal liability of a natural person or persons. If the insurer fails to provide the 75 days’ notice, the existing policy shall remain in effect with no changes from the date that the notice of non-renewal is actually delivered. This is an increase from the current 45 day notice provision.

 

Additionally, the insurer’s notice shall include a statement that if the insured has contacted the insurer to discuss the non-renewal and is not satisfied with the response, the insured may contact the Insurance department. The notice must provide the insurance departments website, (800) number and mailing address. These changes shall apply to all notices of non-renewal issued on or after July 1, 2020.

 

For any questions regarding nonrenewal notices and Assembly Bill 1816, or any other regulatory compliance concerns, please contact Westmont Associates, Inc.