California § 481 - Unless the insurance contract otherwise provides, a person insured is entitled to

§ 481. Unless the insurance contract otherwise provides, a person insured is entitled to

(a) Unless the insurance contract otherwise provides, a person insured is entitled to a return of his or her premium if the policy is canceled, rejected, surrendered, or rescinded, as follows: (1) To the whole premium, if the insurer has not been exposed to any risk of loss. (2) When the insurance is made for a definite period of time and the insured surrenders his or her policy, to that proportion of the premium as corresponds with the unexpired time, after deducting from the whole premium any claim for loss or damage under the policy that has previously accrued. The provisions of Section 482 apply only to the expired time. (b) No contract for individual motor vehicle liability or homeowners’ multiple-peril insurance may contain a provision that mandates that the premium for the policy shall be fully earned upon the happening of any contingency except the expiration of the policy itself. This subdivision shall not apply to policy fees or membership fees. (c) (1) Any insurance policy that includes a provision to refund premium other than on a pro rata basis, including the assessment of cancellation fees, shall disclose that fact in writing, including the actual or maximum fees or penalties to be applied, which may be stated in the form of percentages of the premium. The disclosure shall be provided prior to, or concurrent with, the application and prior to each renewal to which the policy provision applies. For purposes of this subdivision, an insurer offering workers’ compensation insurance, as defined in Section 109, may provide the disclosure with the quote offering insurance to the consumer prior to the consumer accepting the quote in lieu of disclosure prior to, or concurrent with, the application. Disclosure shall not be required if the policy provision permits, but does not require, the insurer to refund premium other than on a pro rata basis, and the insurer refunds premium on a pro rata basis. (2) If an application is made by telephone, the disclosure shall be mailed to the applicant or insured within five business days. (3) The disclosure may be made electronically pursuant to Section 38.6 in lieu of being mailed. (4) This section does not apply to cancellations that are calculated subject to paragraph (2) of subdivision (g) of Section 673. (d) This section shall not apply to policies of ocean marine insurance. For purposes of this section, “ocean marine insurance” means insurance of vessels or crafts, their cargos, marine builders’ risks, marine protection and indemnity, or other risks commonly insured under marine insurance governed by the provisions of Chapter 1 (commencing with Section 1880) of Part 1 of Division 2, and as distinguished from inland marine insurance policies. (e) The disclosure requirements of subdivision (c) shall be prospective and shall apply only to policies issued or renewed on or after January 1, 2012. (f) Nothing in this section shall require any additional disclosure of a fee or penalty for early cancellation if that disclosure is required by any other law.