Purpose of the Bill

The bill aims to amend the existing regulations on the time requirements for the cancellation of insurance policies in Minnesota. This change seeks to ensure that policyholders receive more advanced notice before their insurance policies can be canceled or not renewed.

Main Provisions

• Extended Notice Requirement:
  • For insurance policies that are less than 60 days old and are being canceled due to nonpayment, the notice period is extended from 20 days to 60 days before the effective cancellation date.
  • If a policy is being canceled or declined for underwriting reasons, insurers must provide notice at least 60 days before the cancellation date, and disclose the source of the information that led to this decision.
  • For any midterm cancellation, the notice period is changed from 30 days to 60 days prior to the cancellation date.
  • In cases of nonrenewal of an insurance policy, a notice including the specific underwriting reasons must be sent at least 60 days before the nonrenewal date.

Significant Changes

• The bill represents an adjustment to the existing statute (Minnesota Statutes 2024, section 65A.01, subdivision 3c) by increasing the amount of advanced notice that insurance providers must give policyholders for cancellation or nonrenewal from 20 or 30 days to uniformly 60 days.
• The requirements for providing a specific reason for nonrenewal remain in place but are now accompanied by a longer notice period.
• The amendments specifically exclude commercial policies regulated under sections 60A.36 and 60A.37, meaning they only apply to personal insurance policies.

Relevant Terms

• Insurance policy
• Cancellation notice period
• Nonrenewal
• Underwriting considerations
• Nonpayment of premium