Current through Register Vol. 46, No. 39, September 25, 2024
(a) A product or system group policy or
certificate shall not be subject to Insurance Law, section 3425 or 3426. T he
following requirements shall apply in regard to cancellation, nonrenewal, or
conditional renewal (as defined in subdivision [d] of this section) of
coverage.
(b) Product or system
group policy.
(1) Unless a product or system
group policy provides for a longer policy period, the policy shall be issued or
renewed for a one-year policy period.
(2) A product or system group policy may be
canceled by an insurer only if cancellation is based on one or more of the
reasons set forth in Insurance Law, section 3426(c)(1); provided, however, that
an act or omission by a group member shall not constitute the basis for
cancellation of the policy.
(3) An
insurer's cancellation, nonrenewal, or conditional renewal of a product or
system group policy shall not become effective until at least 30 days after the
insurer mails or delivers written notice of such cancellation, nonrenewal, or
conditional renewal to the group policyholder at the mailing address shown in
the policy.
(4) Every notice of
cancellation, nonrenewal, or conditional renewal shall contain the specific
reason or reasons for cancellation, nonrenewal, or conditional
renewal.
(c)
Certificate.
(1) An individual certificate
may not be canceled, renewed, or conditionally renewed. Coverage under the
certificate shall continue for the period specified in the certificate, even
though the product or system group policy may have been canceled, nonrenewed or
conditionally renewed.
(2) After
the expiration of the period specified in the certificate, nothing in this Part
shall preclude an insurer from offering to continue the coverage under the
certificate as an individual policy, subject to any requirements that may apply
to such a policy.
(d)
Conditional renewal means a renewal which is conditioned upon change of limits,
change in type of coverage, reduction or elimination of coverage, increased
deductible or addition of exclusion, or increased premiums in excess of 10
percent (exclusive of any premium increase generated as a result of increased
exposure units or as a result of experience rating, loss rating, retrospective
rating, or audit).
