Chapter 2 PA laws, regulations and required provisions

Pennsylvania Property and Casualty Insurance Guaranty Association

An organization of insurers licensed to write property and casualty insurance on a direct basis in the Commonwealth of PA.

30 Days

If a property and casualty insurer is declared insolvent and placed into liquidation, the association provides insurance coverage for PA residents, the association will pay claims arising within how many days after the determination of an insurers insolvency?

$10,000

If a property and casualty insurer is declared insolvent and placed into liquidation, the association will not exceed how much for the return of unearned premium?

$300,000

If a property and casualty insurer is declared insolvent and placed into liquidation, the association will not exceed how much for the claimant for all other covered claims?

The insurer

Who will be notified by the association of their assessment within a 30 day time period before it is due?

2

No member may be assessed an amount greater than what percentage of that members direct written premiums in the previous year?

Insurance guaranty association

Insurers cannot advertise protection by the

Fire Insurance

Insurance against direct loss of property by fire, lightening, or removal from the premises endangered by the perils insured against

Coverage, rates, and premiums

In fire insurance what must be specified under the standard form?

Additional coverages or perils

In fire insurance what must be specified under the endorsements?

Policy language equal to the policy language of the 1943 New York Standard Fire Policy

What do all PA property policies issued within the commonwealth require?

4 or less

An owner occupied dwelling is a residential structure that contains how many household units?

The owner

An owner occupied dwelling is a residential structure with four or less units one of which is to be occupied by

60 days

It is considered an unfair insurance practice to cancel or to refuse to renew the policy that is covering an owner occupied building that has been in effect for how many days?

If policy was obtained through misrepresentation or fraud, there has been a substantial change or increase in hazard assumed by the insurance company since the policy was issued, there is a substantial increase in hazard because of the insured’s willful or negligent acts or omissions, failure to pay, the property is not eligible for insurance under PA FAIR plan and policy does not insure farm risks, and any other reason approved by the Commissioner

When can a policy that is covering an owner occupied building be cancelled that wouldn’t be considered unfair insurance practice?

Clearly labeled, be given to the insurer in duplicate, effective date, reason for cancellation or refusal to renew, Insured should be advised that they have the right to request review of the insurers action withing 10 days of receipt of notice, signatures, must be advised that the insured may be eligible for insurance under the FAIR plan, be understand and be set on terms

What must cancelations or refusals to renew include?

10 days

How many days does the insured have the right to request review of the insurer’s action after getting the receipt of notice?

60 days

A policy covering commercial property and casualty risks may not be canceled at midterm if it has been in effect for how many days?

Substantial change in condition, factor, or loss experience, There has been a loss of or substantial decrease in reinsurance that directly affects the policy, misrepresentation or fraud, failure to pay premium, insured has requested cancellation, or there has been material failure to comply with policy terms, conditions, or contract

A policy covering commercial property and casualty risks can only be cancelled at midterm that has been effect for over 60 days if

Notice of cancellation or nonrenewal, notice needs to be sent at least 60 days in advance of the effective date of termination, if insured made misrepresentation that affects risk notice must be sent 15 days in advance, Failure to pay, If policy was cancelled by the request of named insured, notice is not required and can e terminated on date requested

Requirements for midterm cancellations and nonrenewal

10 days

Within how many days must the return unearned premium be returned if the cancellation is initiated by the insurer?

30 days

Within how many days must the return unearned premium be returned if the cancellation is initiated by the insured?

60 day period

Insurers are required to provide what after the effective date of cancellation or nonrenewal during which time the insured can buy an extended reporting coverage endorsement (tail coverage)

Tail coverage

Allows the insured to make a claim for a loss incurred during the policy period

180 days

How many days after the death of the insured must basic property insurance continue for?

Binder

A temporary contract of insurance issued by an insurer or its agent that places insurance in effect prior to the policy being issued

30 days

Binders may be made for a period not to exceed how many days?

Insurance consultation service

Any service performed by an insurer relating to an insurance application, a new insurance policy, or an existing insurance policy for the purpose of reducing the chance of injury, death, or loss

Insurance consultation act

Protects an insurer that performs these services, or fails to perform the services, from liability for damages from injury, death or loss resulting from the services

Injury, death or loss occurred during the actual performance of the services and was caused by the insurer’s negligence, the services were performed as a part of a written service contract that was not incidental to an insurance policy, or the injury, death, or loss was the result of a crime, actual malice or gross negligence

What does the insurance consultation service exemption act not protect?