Code of Massachusetts Regulations › 211 CMR - DIVISION OF INSURANCE › Title 211 CMR 97.00 - Procedures For Cancellation And Non-renewal Of Motor Vehicle Insurance Policies › Section 97.05 - Return Premium Applicable to Cancelled Motor Vehicle Insurance Policies

Current through Register 1525, July 5, 2024
(1) If premium payments have been made on a
			 Motor Vehicle Insurance Policy which is cancelled, the Policyholder may be
			 entitled to the return of premium paid for the unexpired term of that policy.
			 Return premium, if any, shall be determined based on the rates in effect for
			 the Insurer on the date the cancelled Motor Vehicle Insurance Policy first
			 became effective.
(2) An Insurer
			 that cancels a Motor Vehicle Insurance Policy shall calculate return premium on
			 a
pro rata
basis as of the intended effective date of
			 Cancellation, or the date upon which a new certificate of insurance is filed
			 with the Registrar of Motor Vehicles covering the same vehicle that was insured
			 under the cancelled policy, if the effective date of the new Motor Vehicle
			 Insurance Policy is prior to the intended Cancellation date of the cancelled
			 Motor Vehicle Insurance Policy. Any return premium associated with the
			 unexpired portion of the term of the cancelled Motor Vehicle Insurance Policy
			 shall be delivered to the Policyholder within 30 days of the effective date of
			 Cancellation of that policy.
(3) If
			 a Motor Vehicle Insurance Policy that an Insurer cancelled is reinstated by the
			 Board of Appeal or by order of a court in any legal proceeding that the
			 Policyholder initiated relating to the Cancellation, any return premium shall
			 be calculated based on the rates in effect when the cancelled Motor Vehicle
			 Insurance Policy first became effective.
(4) If a Policyholder cancels a Motor Vehicle
			 Insurance Policy, return premium, if any, shall reflect the unexpired portion
			 of the term of the cancelled policy,
pro rata
, in any of the
			 following circumstances:
(a) The Policyholder
			 cancels the Motor Vehicle Insurance Policy within the first 30 days from the
			 date on which the policy becomes effective or the date on which the
			 Policyholder receives the policy documents, whichever is later;
(b) The Policyholder cancels the Motor
			 Vehicle Insurance Policy within 30 days after the date on which the insured
			 motor vehicle is stolen or destroyed, if the loss to the motor vehicle is a
			 total loss or total constructive loss. The return premium, if any, shall be
			 calculated from the day following the date of loss;
(c) The Policyholder cancels the Motor
			 Vehicle Insurance Policy because of entry into the military service of the
			 United States of America; or
(d)
			 The Policyholder cancels a Motor Vehicle Insurance Policy issued through the
			 Massachusetts residual market plan because coverage has been obtained in the
			 voluntary market. The return premium, if any, shall be calculated from the
			 effective date of the Motor Vehicle Insurance Policy that replaces the policy
			 issued through the residual market plan.
Nothing precludes an Insurer from identifying other
				circumstances in which it will calculate the return premium to the Policyholder
				on a
pro rata
basis without short rate adjustments.