Montana § 33-15-1103 - Midterm Cancellation

§ 33-15-1103. Midterm Cancellation

Midterm cancellation. (1) An insurer may not cancel an insurance policy before either the expiration of the agreed term or 1 year from the effective date of the policy or renewal date, whichever is less, except: (a) for reasons specifically allowed by statute; (b) for failure to pay a premium when due; or (c) on grounds stated in the policy which pertain to the following: (i) material misrepresentation; (ii) substantial change in the risk assumed, except to the extent that the insurer should reasonably have foreseen the change or contemplated the risk when the contract was written; (iii) substantial breaches of contractual duties, conditions, or warranties; (iv) determination by the commissioner that continuation of the policy would place the insurer in violation of this code; (v) financial impairment of the insurer; or (vi) any other reason approved by the commissioner. (2) Except as provided in 33-23-401 , cancellation under subsection (1) is not effective until 10 days after a notice of cancellation is either delivered or mailed to the insured. (3) Subsections (1) and (2) do not apply to a newly issued insurance policy if the policy has been in effect less than 60 days at the time the notice of cancellation is mailed or delivered. A cancellation under this subsection is not effective until 10 days after the notice is delivered or mailed to the insured. (4) If a policy has been issued for a term longer than 1 year and if either the premium is prepaid or an agreed term is guaranteed for additional premium consideration, the insurer may not cancel the policy except: (a) for reasons specifically allowed by statute; (b) for failure to pay a premium when due; or (c) on grounds stated in the policy which pertain to those grounds listed in subsection (1)(c).