Washington Administrative Code › Title 284 - Insurance Commissioner, Office of the › Chapter 284-30 - Trade practices › TRADE PRACTICES › Section 284-30-590 - Unfair practices with respect to policy cancellations, renewals, and changes

Current through Register Vol. 24-14, July 15, 2024
(1) It is unfair
				practice to utilize a twenty-day notice to increase premiums by a change of
				rates or to change the terms of a policy to the adverse interest of the insured
				thereunder, except on a one time basis in connection with the renewal of a
				policy as permitted by
				RCW
				 48.18.2901(2), or to utilize
				such notice if it is not, by its contents, made clearly and specifically
				applicable to the particular policy and to the insured thereunder or does not
				provide sufficient information to enable the insured to understand the basic
				nature of any change in terms or to calculate any premium resulting from a
				change of rates.
(2) In the unusual
				situation where a contract permits a midterm change of rates or terms, other
				than in connection with a renewal, it is an unfair practice to effectuate such
				change with less than forty-five days advance written notice to the named
				insured, or to utilize a contract provision which is not set forth
				conspicuously in the contract under an appropriate caption of sufficient
				prominence that it will not be minimized or rendered obscure.
(3) It is an unfair practice to effectuate a
				change of rates or terms other than prospectively. Such changes may be
				effective no sooner than the first day following the expiration of the required
				notice.
(4) If an insured elects to
				not continue coverage beyond the effective date of any change of rates or
				terms, it is an unfair practice to refund any premium on less than a pro rata
				basis.
(5) The cancellation and
				renewal provisions set forth in
				chapter
				48.18 RCW do not apply to
				surplus line policies. To avoid unfair competition and to prevent unfair
				practices with respect to consumers, it is an unfair practice for any surplus
				line broker to procure any policy of insurance pursuant to chapter 48.15 RCW
				that is cancelable by less than ten days advance notice for nonpayment of
				premium and twenty days for any other reason, except as to a policy of
				insurance of a kind exempted by
				RCW
				 48.15.160. This rule shall not prevent the
				cancellation of a fire insurance policy on shorter notice in accord with
				chapter 48.53 RCW.
(6) Except where
				the insurance policy is providing excess liability or excess property insurance
				including so-called umbrella coverage, it is an unfair practice for an insurer
				to make a common practice of giving a notice of nonrenewal of an insurance
				policy followed by its offer to rewrite the insurance, unless the proposed
				renewal insurance is substantially different from that under the expiring
				policy.
(7) Where the rate has not
				changed but an incorrect premium has been charged, if the insurer elects to
				make a midterm premium revision, it is an unfair practice to treat the insured
				less favorably than as follows:
(a) If the
				premium revision is necessary because of an error made by the insurer or its
				agent, the insurer shall:
(i) Notify the
				applicant or insured of the nature of the error and the amount of additional
				premium required; and
(ii) Offer to
				cancel the policy or binder pro rata based on the original (incorrect) premium
				for the period for which coverage was provided; or
(iii) Offer to continue the policy for its
				full term with the correct premium applying no earlier than twenty days after
				the notice of additional premium is mailed to the insured.