Underwriting Refusals Based Solely on Previous Non-Renewal, Rejection or Cancellation of Property and Casualty Insurance

Nebraska Department of Insurance Guidance Document IGD - - C2 Title: Underwriting Refusals Based Solely on Previous Non-Renewal Rejection or Cancellation of Property and Casualty Insurance Issue Date: October 20, 2022 Previously: Issued as CB-40, May 18, 1994 Notice: This guidance document is advisory in nature but is binding on an agency until amended by such agency. A guidance document does not include internal procedural documents that only affect the internal operations of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules and regulations made in accordance with the Administrative Procedure Act. If you believe that this guidance document imposes additional requirements or penalties on regulated parties, you may request a review of the document. Some property and casualty insurers have taken underwriting action, usually either declining or placing risk in a higher-rated company, based solely upon an applicant’s response to questions concerning previous nonrenewal, rejection, or cancellation of the applicant’s property and casualty insurance. The Nebraska Department of Insurance’s “NDOI” position is that insurers may not decline or place risk in a higher-rated company if it is based solely upon the responses to the questions. Insurers can solicit additional information when seeking the reasons for past nonrenewal, rejections, or cancellations. The underlying reasons are essential for competent underwriting decisions. The NDOI recommends that all companies review their applications either eliminating this question or expanding it to include the reasons. Questions regarding this guidance can be directed to the NDOI’s Property and Casualty Administrator at 402-471-2201.