Non-Renewal Notice on a Commercial General Liability Insurance Policy
Question: “My insured received the attached non-renewal notice on their Commercial General Liability insurance policy. Is it a legal notice? The coverage is provided by a non-admitted carrier.”
Answer: Commercial lines policies written on an excess lines basis are exempt from New York’s cancellation, non-renewal and conditional renewal laws. They are governed by the terms and conditions of the individual policies.
“N.Y. Ins. Law § 3426 (McKinney 2000), which sets out the cancellation and renewal provisions regarding commercial lines insurance, does not apply to policies written on an excess line basis. N.Y. Ins. Law § 3426 (l)(2) (McKinney 2000) states:
This section shall not apply to policies issued pursuant to a plan established under article fifty-three, fifty-four or fifty-five of this chapter, surety policies, policies providing workers’ compensation or employers’ liability coverage, financial guaranty insurance, policies providing mortgage guaranty or credit insurance, policies principally marine insurance as defined by paragraph twenty of subsection (a) of section one thousand one hundred thirteen of this chapter, legal services insurance, reinsurance contracts, policies written on an excess line basis, or policies subject to section three thousand four hundred twenty five of this chapter. [Emphasis added]
Cancellation and non-renewal of a policy that is written by an unauthorized insurer through the excess line market is, therefore, governed exclusively by the terms of such policy.”
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