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Findings and Decision

This proceeding arose upon a request for hearing made by Ethan Guyaz (hereinafter the “Insured”) to contest the pending nonrenewal of automobile insurance coverage provided by State Farm Mutual Automobile Insurance Company (hereinafter the “Company.”) On January 15, 2004, the Company mailed a notice of nonrenewal effective February 21, 2004, on policy number 36 0616-B21-19F, citing as the grounds for nonrenewal: “driving record of Ethan Guyaz: 12/05/03 accident, 03/27/03 accident”. Pursuant to 24-A M.R.S.A. § 2920, the Insured's hearing request was timely.

A hearing in this matter was held pursuant to 24-A M.R.S.A. § 2920 on February 25, 2004, with Mary Ellen Albert sitting as designated hearing officer. See 24-A M.R.S.A. § 210. The purpose of the hearing was limited to establishing the existence of the proof or evidence given by the Company to support its reason for policy nonrenewal. Staff representing the Company submitted a sworn statement in lieu of appearing at the hearing. The Insured appeared at the hearing accompanied by his parents, Penny and Norman Guyaz.

FINDINGS OF FACT

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

1. The Company has provided the Insured with automobile coverage since February 21, 1997.
2. On 3/27/03, the Insured was attempting to turn right. Another vehicle was in the outer lane on the right and the Insured turned into that vehicle. The Company paid $1,436 under Property Damage Liability Coverage.
3. On 12/5/03, the Insured failed to stop in time to avoid rear-ending a stopped vehicle in front of him. The Company paid $2,172 under Property Damage Liability and $2,106 under Collision coverage.

ANALYSIS AND CONCLUSION OF LAW

Title 24-A M.R.S.A. § 2916-A (2) permits nonrenewal “[w]hen a named insured or any other person who operates a motor vehicle insured under the policy is individually or are aggregately involved in 2 or more vehicle accidents while operating a motor vehicle insured under the policy, resulting in either personal injury or property damage in excess of the amount defined as a reportable accident under Title 29-A, section 2251, subsection 1” during the 36-month period preceding the yearly anniversary date of the policy. The amount provided by 29-A M.R.S.A. § 2251(1) is $1,000. Section 2916-A(2) further identifies four circumstances which are not considered accidents.

Tami Zielinski, Underwriting Team Leader for the Company, stated in her affidavit that the Insured has had two vehicle accidents resulting in either personal injury or property damage in excess of $1,000 in the 36 months preceding the yearly anniversary date of the policy. She submitted loss documents to establish the details of the losses.

The Insured testified that he did have two accidents but he did not believe that the accident of March 27, 2003, caused $1,000 in property damage. He argued that the Company paid the claim without his knowledge which they should not be able to do.

The Personal Auto Policy provided by the Company states on page 7 that “We will pay damages for which an insured becomes legally liable to pay because of bodily damage to others, and damage to or destruction of property including loss of its use, caused by accident resulting from the ownership, maintenance or use of your car.” In addition, the policy states, “We have the right to investigate, negotiate and settle any claim or suit.” The policy allows the Company to decide whether to pay a claim brought against the policy by a third party, and what amount to pay for that claim. Therefore, the Company was within its contractual rights when it settled the claim.

The Superintendent of Insurance has jurisdiction over this matter pursuant to 24-A M.R.S.A. § 2920. The Company bears the burden of proof for establishing that the statutory grounds for policy nonrenewal exist. According to the evidence presented at the hearing, the Insured’s accidents fall within the parameters of the statute, and none of the exceptions provided by § 2916-A apply. Accordingly, the Superintendent hereby concludes that the Company has established adequate grounds for policy nonrenewal.

ORDER AND NOTICE OF APPEAL RIGHTS

The intended termination is hereby approved. State Farm Mutual Automobile Insurance Company is directed to continue coverage until 12:01 a.m. on April 13, 2004, to allow the policyholder an 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 Title 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.

Dated March 29, 2004                                                 Alessandro A. Iuppa
                                                                                    Superintendent of Insurance

                                                                                    ____________________________________
                                                                                    by Mary Ellen Albert
                                                                                    Designated Hearing Officer

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