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This proceeding arose upon a request for hearing made by Raymond & Kimberly Stuart of Gardiner, ME, to contest the pending nonrenewal of automobile insurance coverage provided by Travelers Indemnity Company of Connecticut. On January 10, 2003, the insurer mailed a notice of nonrenewal effective February 16, 2003 on policy number 931035093 101 1, citing “driving record of the operator listed below. We have learned from a motor vehicle report of the following: Kimberly Stuart 05/02/2000 operating after suspension, 05/25/00 license suspension to 07/24/00, 10/25/00 operating after suspension, 11/27/00 revocation to 11/27/01 – habitual offender, 08/14/01 fail to file proof of financial responsibility” as the grounds for nonrenewal. Pursuant to 24-A M.R.S.A. §§ 2917 and 2920, Travelers Indemnity Company of Connecticut provided the insured with proper notice and the insured's hearing request was timely.

A hearing in this matter was held on February 11, 2003 with Connie Mayette sitting as designated hearing officer pursuant to 24-A M.R.S.A. §§ 210 and 2920. The purpose of the hearing was limited to establishing the existence of proof or evidence given by the insurer to support its reason for policy nonrenewal. Staff representing Travelers Indemnity Company of Connecticut submitted a sworn statement in lieu of appearance at the hearing. Kimberly Stuart appeared on her own behalf.

FINDINGS OF FACT

The following facts have been proven by a preponderance of evidence submitted:

1. Travelers has written the automobile exposure of the Stuarts since February 16, 2001. The application signed by Raymond Stuart did not list Kimberly as a driver or co-applicant, but stated that “his wife Kimberly does not drive because of health reasons and sent back her license to the state.”
2. An endorsement request dated July 26, 2002 indicated that Kimberly should be added as a driver, and required an SR-22 (financial responsibility) filing. Her date of birth and drivers license number were provided at that time.
3. The motor vehicle record obtained as a result of that request shows the following:
   08/19/99 Conviction - Operating under the influence of liquor on 05/01/99
   05/02/00 Conviction - Operating after suspension on 04/07/00
   05/25/00 Suspension - to 07/24/00 Administrative action for conviction
   10/05/00 Conviction - Operating after suspension on 07/09/00
   11/27/00 Revocation - Habitual Offender, restored 11/27/01, stay issued 08/14/01
   08/13/01 Insurance effective 08/13/01
   08/14/01 Fail to file future proof
4. Following a hearing with the Bureau of Motor Vehicles (BMV) in 2001, an adjustment was made to Kimberly Stuart’s driving record. A notice from the BMV dated 11/27/01 indicates that her privilege to operate and register motor vehicles in Maine was restored as of 11/27/01, and that the 11/27/00 habitual offender suspension was no longer in effect. It also indicates that a 9/23/01 suspension for failure to file insurance had been reviewed and subsequently deleted from her record, as it had been done in error.

ANALYSIS AND CONCLUSION OF LAW

Rebecca Simons, Personal Lines Underwriter for the Travelers Group, stated in her sworn statement that the motor vehicle record for Kimberly Stuart includes two convictions for operating after the influence. Her testimony also alluded to material misrepresentation in the application, as the application indicated Mrs. Stuart’s license had been voluntarily returned to the state due to a medical condition. She further stated that the application question “any drivers license been suspended/revoked?” was marked no. She indicated that the application would have been declined in 2001 based upon the revocation, major violations and failure to file proof of financial responsibility within the prior three years.

Mrs. Stuart argued that the company and the agency had been well aware of her record as they had insured them for several years. It is noted that the application indicates the prior carrier was Dairyland, and that the risk was new business to the company and the agency at the time. (A question on the application asks if the insurance has been transferred within the agency, and it was answered no, indicating that the agency was not currently handling their auto coverage prior to this application).

Mrs. Stuart testified that she did not have a license at the time this application was made, therefore she was not listed as a driver. As the application asks “has any driver shown above …been convicted of a moving violation within the last three years,” and “has any drivers license been suspended/revoked,” she felt that the answers given were correct because she was not driving.

She also indicated that she was not able to drive because of her medication, and that her doctor had taken her out of work on 01/02/01. She stated she had already given a medical note saying she could not drive due to medication, and submitted a 6/16/02 letter from her primary care physician. The letter states it is to clarify Kimberly Stuart’s work capacity, and noted that she was restricted from driving herself to work and from driving on the job until she completes a course of occupational therapy for driving safety. Although the letter makes no mention of medication, Mrs. Stuart testified that she still has driving restrictions as her medication impairs her vision and reaction time, and she will not drive for four to six hours after taking the medication.

Mrs. Stuart further testified that the BMV removed the habitual offender charge from her record as well as the incorrect suspension for failure to file insurance. She submitted a copy of the letter from the BMV dated 11/27/01 amending her record and also the motor vehicle record report she obtained directly from BMV on 2/6/03. She argued that the entry dated 11/22/00 on her record (which states “hearing-cr excess points, results rescinded”) rescinds the convictions for operating after suspension and the revocation. It is noted that the revocation for habitual offender still appears on the current record as the license had been revoked for a year. Both convictions for operating after suspension also appear on this record.

Mrs. Stuart further argued that the company had been well aware of her existence, as evidenced by every policy statement to “Raymond and Kimberly Stuart.” She submitted a form letter they received with the first policy, addressed to Raymond and Kimberly Stuart, which begins “Welcome to Travelers Insurance.”

The Superintendent of Insurance has jurisdiction over this matter pursuant to 24-A M.R.S.A. § 2920. Travelers Indemnity Company of Connecticut bears the burden of proof for establishing that the statutory grounds for policy nonrenewal exist. Based on the evidence presented at the hearing, the Superintendent hereby concludes that Travelers Indemnity Company of Connecticut has established adequate grounds for policy nonrenewal.

Title 24-A M.R.S.A. § 2916-A(1)(E) permits an insurer to nonrenew a policy of automobile insurance if a named insured or any operator has been convicted of operating a motor vehicle during a period of suspension or revocation of his license within the 36 months preceding the annual anniversary date of the policy. The annual anniversary date of this policy is February 16, 2003, and Kimberly Stuart’s convictions of May 2, 2000 and October 5, 2000 are both within the required 36-month time frame.

Although Mrs. Stuart argued that the company had known her record all along and that the convictions had been rescinded by the BMV, the evidence on the record, however, does not fully support those contentions. Even if the insurer had known of these circumstances, the governing statute does not require that the permitted grounds for nonrenewal be previously unknown to the company. It simply requires that a conviction meeting the requirements occurred during the requisite time frame.

The testimony provided by the company also references material misrepresentation in obtaining the insurance. Although 24-A M.R.S.A. § 2914(2) permits cancellation for this reason, and 24-A M.R.S.A. § 2916-A permits nonrenewal based upon a reason for which the policy could be cancelled, this issue is not being considered. Title 24-A M.R.S.A. § 2917 states “the reason or reasons for the intended nonrenewal action shall accompany the notice of intent not to renew and the reason or reasons shall be explicit.” No mention was made in the reason given on the notice of material misrepresentation.

INDEX OF RECORD:
Exhibit 1 - Affidavit of Rebecca Simons
Exhibit 2 - February 2001 application
Exhibit 3 - July 26, 2002 endorsement request
Exhibit 4 - MVR dated 8/5/02
Exhibit 5 - November 27, 2001 letter from BMV
Exhibit 6 - June 16, 2002 letter from Dr. Ross
Exhibit 7 - MVR dated 2/6/03
Exhibit 8 - Welcome to Travelers letter

ORDER AND NOTICE OF APPEAL RIGHTS

The intended termination is hereby approved. Travelers Indemnity Company of CT is directed to continue coverage until March 21, 2003 at 12:01 a.m. to allow Mr. and Mrs. Stuart the opportunity to obtain other coverage.

This Decision and Order is a final agency action within the meaning of the Maine Administrative Procedure Act. It is appealable to the Superior Court in the manner provided in 24-A M.R.S.A. § 236 and M.R. Civ. P. 80C. Any party to the hearing may initiate an appeal within 30 days after receipt of this notice. Any nonparty whose interests are substantially and directly affected may initiate an appeal within 40 days of the effective date of this Decision and Order.

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