Understanding Cancellations and Non-renewals for an Architects/Engineers Professional Liability Policy

The insurance companies are regulated by each state and each state has a specific time period that the insurance company must provide a notice of cancellation or non-renewal.

The insurance must provide notice of cancellation and the cancellation may be for various reasons. The insurance company may cancel for a false statement on the application submitted. Also, they may cancel due to a change in the risk not stated on the application or a change that the insured has not notified the insurance company about.

The insurance will provide 10 day notice of cancellation for non-payment of premium (may vary by state). If your firm has not paid the premium, the insurance company can cancel the policy but must provide notice.

If the insurance company is going to non-renew your firm’s policy they are required to provide 45 days of notification (may vary by state). Some of the reasons an insurance company may non-renewal a policy would be due to adverse claims history, false information provided on the application or a change in your firms services or project types.

Your firm may also cancel a policy at any time during the policy period. Keep in mind there may be a cancellation fee associated with the cancellation if it is cancelled mid-term. If your firm does not renew a policy with a specific insurance company there will not need to be notification on the cancellation. If your firm does decided to cancel your Professional Liability policy and your firm is replacing it with another policy be sure to check the retroactive date of the new policy.

There are a few scenarios that your policy may be cancelled or non-renewed, review them in your firms policy. If there are any questions about cancellations or non-renewals please call or email your Professional Underwriters agent for assistance.