House Bill 1611

AN ACT TO AMEND SECTION 83-5-28, MISSISSIPPI CODE OF 1972, TO REQUIRE INSURANCE COMPANIES TO ISSUE NOTICES FOR RENEWAL, CANCELLATION, REDUCTION OF COVERAGE OR NONRENEWAL OF PROPERTY AND CASUALTY INSURANCE NOT LESS THAN FORTY-FIVE DAYS BEFORE THE EFFECTIVE DATE OF THE RENEWAL, CANCELLATION, REDUCTION OF COVERAGE OR NONRENEWAL; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 83-5-28, Mississippi Code of 1972, is amended as follows:

83-5-28. (1) A renewal, cancellation, reduction in coverage or nonrenewal of liability insurance coverage, fire insurance coverage or single premium multiperil insurance coverage is not effective as to any coverage issued or renewed after * * *~~June 30, 1989~~ January 1, 2026, unless notice is mailed or delivered to the insured and to any named creditor loss payee by the insurer not less than * * *~~thirty (30)~~ forty-five (45) days prior to the effective date of such cancellation, reduction or nonrenewal. This section shall not apply to nonpayment of premium unless there is a named creditor loss payee, in which case at least ten (10) days' notice is required. The * * *~~cancellation and nonrenewal~~ notice requirements of this section shall not apply when a replacement policy form is issued by the same insurer or when a transfer of an insured to a licensed affiliate of the insurer occurs, so long as the replacement of policy forms or transfer results in the same or substantially similar coverage and the insurer mails or delivers to the insured at least * * *~~thirty (30)~~ forty-five (45) days prior to the renewal effective date notice of any term or condition that is less favorable to the policyholder.

(2) The provisions of subsection (1) shall be incorporated into each liability, fire and multiperil policy issued or renewed after * * *~~June 30, 1989~~ January 1, 2026; and if such provisions are not expressly stated in the policy, such provisions shall be deemed to be incorporated in the policy.

(3) Whenever a replacement policy form is issued by the same insurer or when transfer of an insured to a licensed affiliate occurs, documents signed by the insured are applicable to the replacement policy form, the coverage transferred to a licensed affiliate insurer, or both, and remain valid and enforceable.

(4) A transferring insurer shall notify the Mississippi Insurance Department at least forty-five (45) days in advance of notifying a policyholder that its personal or commercial lines insurance policies will be transferred to another licensed insurer within the same insurance group or same holding company. The notice shall include the name of insurer transferring the personal or commercial lines policies and the name and financial rating of the insurer receiving the transferred personal or commercial lines policies.

(5) A transferring insurer shall provide the policyholder written notice of the policy transfer at least * * *~~thirty (30)~~ forty-five (45) days prior to expiration of the policy term and shall include the financial rating of the insurer receiving the transferred policy. Such notice must be provided to the policyholder with the notice of renewal premium at least * * *~~thirty (30)~~ forty-five (45) days before the effective date of the transfer.

(6) If the insurer fails to meet the notice requirement of this section, the named insured has the option of continuing the policy or contract for the remainder of the notice period plus an additional forty-five (45) days at the premium rate of the existing policy or contract. Such option shall continue in forty-five (45) day increments until the insurer provides the notice required in this section.

( * * *67) As used in this section:

(a) "Affiliate transfer" is when an insurer transfers, at renewal or policy expiration, its personal or commercial lines insurance policies to an affiliated licensed insurer that is a member of the same insurance group or same holding company as the transferring insurer. The issuance of a replacement policy form providing the same or substantially similar coverage issued by the same insurer, or the transfer of personal or commercial insurance policies to a licensed affiliate insurer that will issue the same or substantially similar policy, are considered a renewal and will not be treated as a cancellation or nonrenewal. The affiliate transfer must be to a licensed affiliate insurer that has been determined by the commissioner to have the same or better financial strength as the transferring insurer. The policy transfer must be selected on a nondiscriminatory basis.

(b) "Substantially similar" means a policy that provides the same basic coverages but may add, alter or eliminate incidental coverages and may provide coverages using different textual language.

SECTION 2. This act shall take effect and be in force from and after January 1, 2026.