Rule 20:06:29:01 Cancellation by insurer or policyholder.
by insurer or policyholder. An insurer canceling a policy must return to
the policyholder unearned premiums on at least a pro rata basis. An insurer may
use a short rate calculation of unearned premiums if the cancellation is at the
request of the policyholder. A cancellation is not considered to be at the
request of the policyholder if the premium increases at policy renewal or at
inception in excess of the quoted rate and the insurer fails to provide notice
of the premium increase before the renewal or inception date. If it is
specified in the policy, an insurer may either calculate all cancellations
short rate or consider the premium fully earned at policy inception for short
term or seasonal policies. The requirements of this section do not apply to
surety insurance which requires the payment of a minimum premium or a premium
that is fully earned pursuant to rules or rates filed and approved by the
division. Nothing in this section prohibits an insurer from having a minimum premium
of not more than $25 on property and casualty coverage provided that the
minimum premium is filed as part of a rating plan pursuant to SDCL chapter 58-24. This section does not apply to life insurance.
22 SDR 52, effective October 25, 1995; 24 SDR 86, effective December 31, 1997;
25 SDR 76, effective November 26, 1998; 31 SDR 214, effective July 6, 2005; 36
SDR 112, effective January 11, 2010.
Authority: SDCL 58-11-63(7)(9).
Implemented: SDCL 58-11-63(7)(9), 58-33-83, 58-33-84.
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