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Peter Kovacs v. GEICO Casualty Company
Hearing #INS-06-2020, Decision Issued March 29, 2006.

The insured requested a hearing following receipt of a notice of automobile insurance coverage cancellation citing nonpayment of premium. At hearing, the company presented evidence of the billing and payment history on the policy as well as the post office certificate of mailing. The insured conceded that no payment had been made.

Held: For the company. Title 24-A M.R.S.A. § 2914(1) permits an insurer to cancel a policy when the insured does not pay the full premium amount when due. In the present matter, an installment was due February 17, 2006, and no payment was received. A notice for cancellation was issued on February 20, for cancellation to take effect March 8. The Company offered to continue coverage if the amount due of $411 was paid by that date. In addition, the Company offered prior to the hearing to continue coverage if $300 could be paid by March 17, but the Insured did not make a payment.

The law does not require the Company to provide the Insured with additional opportunities to pay in order to avoid cancellation. The insured had failed to discharge the obligation due on February 17. The Company’s cancellation notice was received by the Insured after the premium due date thus meeting the requirement of § 2914(1). Based on the evidence presented at the hearing, the Superintendent hereby concludes that the Company has established adequate grounds for policy cancellation.

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