SECTIONS I AND II—CONDITIONS

C. Cancellation

1. The named insured has the right to cancel the policy at any time and for any reason. The only requirement is that the policy be returned or that a written notice be given to the insurance company. The named insured must specify that date upon which the cancellation is to be effective.

2. The insurance company is more restricted in how it may cancel the policy. A written notice must either be given to the named insured or mailed to the mailing address on the declarations. The reason for the cancellation must be stated and those reasons and when they can be used are explained below.

Note: Proof of mailing will be sufficient proof of notice.

a. Non-payment of premium - When premium has not been paid, the insurance company may cancel at any time by providing no less than 10 days notice before the date cancellation takes effect.

b. Under 60 days of coverage - When this is the first policy issued by this insurance company for this named insured and it been in effect for less than 60 days the insurance company may cancel for any reason by providing no less than 10 days notice before the date cancellation takes effect.

c. When this policy has been in effect for 60 days or more or if the policy is a renewal of a policy previously issued by this insurance company there are significant restrictions in cancellation. The insurance company may cancel only if one of the following occurs:

·         There has been a material misrepresentation of fact. This fact must be such that had it been known the policy would not have been issued.

·         A substantial change in the risk occurred after the policy was issued.

If either of these occurs, the insurance company must provide no less than 30 days notice before the date cancellation takes effect.

d. Multi-year policies - When this policy is written for a period of more than one year, the insurance company has the right to cancel it for any reason on its anniversary date. The insurance company must provide no less than 30 days notice before the date cancellation takes effect.

3. The premium for the unused days of insurance must be refunded when the policy is cancelled. The refund must be calculated on a pro rata basis.

4. The return premium can be provided with the notice of cancellation or at a later date provided the time frame is reasonable.