Bulletin 2000-04 Personal Lines Pro-Rata Cancellation

Personal Lines Pro-Rata Cancellation (Issued upon June 8, 2000) To: Property and Casualty Insurers From: Ernst N. Csiszar, Director Subject: Personal Lines Pro-Rata Cancellation Legislation has been enacted recently that affects the Property and Casualty Industry. Act 263 was enacted on May 16, 2000 and takes effect on January 1, 2001. This bulletin is intended to bring the provisions of that Act to the attention of insurers in South Carolina. The contact person for this Bulletin is Nancy Hoffman, Casualty Actuary, 300 Arbor Lake Drive, Suite 1200, Columbia, SC 29223, Phone 803-737-6230, Fax 803-737-6233, E-mail: nhoffman@doi.sc.gov. If Ms. Hoffman is not available, ask for an employee of the Property and Casualty Division. The Act provides the following effective January 1, 2001: SECTION 1. 38-39-90 (e) of the 1976 Code is amended to read: "(e) Whenever an insurance contract is canceled, the insurer shall return whatever gross unearned premiums are due under the insurance contract to the premium service company which financed the premium for the account of the insured. The gross unearned premiums due on personal lines insurance contracts financed by premium service companies must be computed on a pro rata basis." Please note that this applies only to personal lines insurance and to those insurance coverage contracts financed by premium service companies.