COMMITTEE SUBSTITUTE

FOR

Senate Bill No. 155

(By Senator Helmick)

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[Originating in the Committee on Banking and Insurance;

reported February 28, 2000.]

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A BILL to amend and reenact sections one, two and four, article six-a, chapter thirty-three of the code of West Virginia, one thousand nine hundred thirty-one, as amended, all relating to the cancellation or nonrenewal of automobile liability insurance policies for moving violations resulting in three or more points on the driver's record and at-fault motor vehicle accidents; and permitting an insurer to transfer an insured between companies for a valid underwriting reason increasing risk.

Be it enacted by the Legislature of West Virginia:
That sections one, two and four, article six-a, chapter thirty-three of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted, all to read as follows:
ARTICLE 6A. CANCELLATION OR NONRENEWAL OF AUTOMOBILE LIABILITY POLICIES.

§33-6A-1. Cancellation prohibited except for specified reasons; notice.
No insurer once having issued or delivered a policy providing automobile liability insurance in this state insuring a private passenger automobile may, after the policy has been in effect for sixty days, or in case of renewal effective immediately, issue or cause to issue a notice of cancellation during the term of the policy except for one or more of the reasons specified in this section:
(a) The named insured fails to discharge when due any of his or her obligations in connection with the payment make payments of premium for the policy or any installment of the premium when due;
(b) The policy was is obtained through material misrepresentation;
(c) The insured violates any of the material terms and conditions of the policy;
(d) The named insured or any other operator, either resident residing in the same household or who customarily operates an automobile insured under the policy:
(1) Has had his or her operator's license suspended or revoked during the policy period including suspension or revocation for failure to comply with the provisions of article five-a, chapter seventeen-c of this code, regarding consent for a chemical test for intoxication: Provided, That when a license is suspended for sixty days by the commissioner of motor vehicles because a person did drive drove a motor vehicle while under the age of twenty-one years with an alcohol concentration in his or her blood of two hundredths of one percent or more, by weight, but less than ten hundredths of one percent, by weight, pursuant to subsection (l), section two, article five-a, chapter seventeen-c of this code, the suspension shall not be grounds for cancellation; or
(2) Is or becomes subject to epilepsy or heart attacks and the individual cannot produce a certificate from a physician testifying to his or her ability to operate a motor vehicle.
(e) The named insured or any other operator, either resident residing in the same household or who customarily operates an automobile insured under such policy, is convicted of or forfeits bail during the policy period for any of the following reasons:
(1) Any felony or assault involving the use of a motor vehicle;
(2) Negligent homicide arising out of the operation of a motor vehicle;
(3) Operating a motor vehicle while under the influence of alcohol or of any controlled substance or while having an alcohol concentration in his or her blood of ten hundredths of one percent or more, by weight;
(4) Leaving the scene of a motor vehicle accident in which the insured is involved without reporting it as required by law;
(5) Theft of a motor vehicle or the unlawful taking of a motor vehicle;
(6) Making false statements in an application for a motor vehicle operator's license;
(7) A third moving traffic violation, committed within a period of twelve months, of any moving traffic violation which constitutes a misdemeanor, whether or not the violations were repetitious of the same offense or were different offenses, resulting in three or more points being assessed on the driver's record by the division of motor vehicles, whether or not the insured renewed the policy without knowledge of all such violations. Notice of any cancellation made pursuant to this subsection shall be made to the insured within six months of the date of the third moving traffic violation.
Notwithstanding any of the provisions of this section to the contrary, no insurance company insurer may cancel a policy of automobile liability insurance without first giving the insured thirty days' notice of its intention to cancel: Provided, That cancellation of the insurance policy by the insurance carrier insurer for failure of consideration to be paid by the insured upon initial issuance of the insurance policy is effective upon the expiration of ten days' notice of cancellation to the insured.
§33-6A-2. Cancellation for other reasons void.

Any purported cancellation by an insurer of a policy of automobile liability insurance which has been in effect for sixty days and which has been renewed shall be void if such the purported cancellation is contrary to section one of this article. For purposes of this article, the transfer of an insured between insurance companies within the same group is not considered a cancellation or nonrenewal of an automobile liability insurance policy if the transfer is based upon any valid underwriting reason involving a substantially increased risk associated with the policy.
§33-6A-4. Advance notice of nonrenewal required; assigned risk policies; reasons for nonrenewal; hearing and review after nonrenewal.

No insurer shall fail to renew an outstanding automobile liability or physical damage insurance policy unless such nonrenewal is preceded by at least forty-five days of advance notice to the named insured of such insurer's election not to renew such policy: Provided, That subject to this section, nothing contained in this article shall be construed so as to prevent an insurer from refusing to issue an automobile liability or physical damage insurance policy upon application to such insurer, nor shall any provision of this article be construed to prevent an insurer from refusing to renew such a policy upon expiration, except as to the notice requirements of this section, and except further as to those applicants lawfully submitted pursuant to the West Virginia assigned risk plan: Provided, however, That an insurer may not fail to renew an outstanding automobile liability or physical damage insurance policy which has been in existence for two consecutive years or longer except for the following reasons:
(a) The named insured fails to discharge when due any of his obligations in connection with the payments make payments of premium for such policy or any installment thereof of the premium when due;
(b) The policy was is obtained through material misrepresentation;
(c) The insured violates any of the material terms and conditions of the policy;
(d) The named insured or any other operator, either resident residing in the same household or who customarily operates an automobile insured under such policy:
(1) Has had his or her operator's license suspended or revoked during the policy period; or
(2) Is or becomes subject to epilepsy or heart attacks and such individual cannot produce a certificate from a physician testifying to his ability to operate a motor vehicle;
(e) The named insured or any other operator, either resident residing in the same household or who customarily operates an automobile insured under such policy, is convicted of or forfeits bail during the policy period for any of the following reasons:
(1) Any felony or assault involving the use of a motor vehicle;
(2) Negligent homicide arising out of the operation of a motor vehicle;
(3) Operating a motor vehicle while under the influence of intoxicating liquor or of any narcotic drug;
(4) Leaving the scene of a motor vehicle accident in which the insured is involved without reporting it as required by law;
(5) Theft of a motor vehicle or the unlawful taking of a motor vehicle;
(6) Making false statements in an application for a motor vehicle operator's license;
(7) A second moving traffic violation, committed within a period of twelve months, of any moving traffic violation which constitutes a misdemeanor, whether or not the violations were repetitions of the same offense or were different offenses, resulting in three or more points being assessed on the driver's record by the division of motor vehicles, whether or not the insurer renewed the policy without knowledge of all such violations. Notice of any nonrenewal made pursuant to this subsection shall be mailed to the insured within six months of the date of the second moving traffic violation.
(f) The named insured or any other operator has had a second at-fault motor vehicle accident within a period of twelve months, whether or not the insurer renewed the policy without knowledge of all such accidents. Notice of any nonrenewal made pursuant to this subsection shall be mailed to the insured within six months of the date of the second accident.
Nonrenewal of such policy for any reason is subject to a hearing and review as provided for in section five of this article. Cost of the hearing shall be assessed against the losing party but shall not exceed seventy-five dollars.
Notwithstanding the provisions of subsection (a) of this section, the insurer shall renew any automobile liability or physical damage insurance policy that has not been renewed due to the insured's failure to pay the renewal premium when due, if: (1) None of the other grounds for nonrenewal as set forth in subsections (b) through (f), inclusive, of this section exist; and (2) the insured makes an application for renewal within ninety days of the original expiration date of the policy. If a policy be is renewed as provided for in this paragraph, the coverage afforded shall not be retroactive to the original expiration date of the policy, but shall resume upon begin on the renewal reinstatement date at the current premium levels offered by the company.
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(NOTE: The purpose of this bill is to permit an insurer to cancel or not renew a motor vehicle liability insurance policy within six months of the date of: 1) A second or third moving traffic violation that results in three or more points being assessed on the driver's record by the department of motor vehicles; or 2) a second at-fault accident within a twelve month period. The bill further permits an insurer to move an insured between companies in its insurance group for valid underwriting reason.
Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.)