Nebraska Revised Statute 44-522
Policies; cancellation requirements.
(1) No insurer may file an insurance policy with the department, as required by the Property and Casualty Insurance Rate and Form Act, which insures against loss or damage to property or against legal liability from any cause unless such policy contains appropriate provisions for cancellation thereof by either the insurer or the insured and for nonrenewal thereof by the insurer.
(2) On any policy or binder of property, marine, or liability insurance, as specified in section 44-201, the insurer shall give the insured sixty days' written notice prior to cancellation or nonrenewal of such policy or binder, except that the insurer may cancel upon ten days' written notice to the insured in the event of nonpayment of premium or if such policy or binder has a specified term of sixty days or less unless the policy or binder has previously been renewed. The requirements of this subsection shall apply to a cancellation initiated by a premium finance company for nonpayment of premium. The provisions of this subsection and subsection (4) of this section shall not apply to nonrenewal of a policy or binder which has a specified term of sixty days or less unless the policy or binder has previously been renewed. Such notice shall state the reason for cancellation or nonrenewal.
(3) Notwithstanding subsection (2) of this section, no policy of property, marine, or liability insurance, as specified in section 44-201, which has been in effect for more than sixty days shall be canceled by the insurer except for one of the following reasons:
(a) Nonpayment of premium;
(b) The policy was obtained through a material misrepresentation;
(c) Any insured has submitted a fraudulent claim;
(d) Any insured has violated any of the terms and conditions of the policy;
(e) The risk originally accepted has substantially increased;
(f) Certification to the Director of Insurance of loss of reinsurance by the insurer which provided coverage to the insurer for all or a substantial part of the underlying risk insured; or
(g) The determination by the director that the continuation of the policy could place the insurer in violation of the insurance laws of this state.
(4) Notice of cancellation or nonrenewal shall be sent by registered mail, certified mail, first-class mail, or first-class mail using intelligent mail barcode or another similar tracking method used or approved by the United States Postal Service to the insured's last mailing address known to the insurer. If sent by first-class mail, a United States Postal Service certificate of mailing shall be sufficient proof of receipt of notice on the third calendar day after the date of the certificate.
(5) For purposes of this section:
(a) An insurer's substitution of insurance upon renewal which results in substantially equivalent coverage shall not be considered a cancellation of or a refusal to renew a policy; and
(b) The transfer of a policyholder between insurers within the same insurance group shall be considered a cancellation or a refusal to renew a policy only if the transfer results in policy coverage or rates substantially less favorable to the insured.
(6) The requirements of subsections (2), (3), and (4) of this section shall not apply to automobile insurance coverage, insurance coverage issued under the Nebraska Workers' Compensation Act, insurance coverage on growing crops, or insurance coverage which is for a specified season or event and which is not subject to renewal or replacement.
(7) All policy forms issued for delivery in Nebraska shall conform to this section.
- Laws 1913, c. 154, § 72, p. 424;
- R.S.1913, § 3208;
- Laws 1919, c. 190, tit. V, art. IV, § 42, p. 604;
- C.S.1922, § 7807;
- C.S.1929, § 44-342;
- R.S.1943, § 44-379;
- Laws 1955, c. 176, § 1, p. 505;
- Laws 1986, LB 1184, § 1;
- R.S.1943, (1988), § 44-379;
- Laws 1989, LB 92, § 126;
- Laws 1991, LB 233, § 45;
- Laws 1999, LB 326, § 3;
- Laws 2000, LB 1119, § 37;
- Laws 2001, LB 360, § 5;
- Laws 2007, LB117, § 7;
- Laws 2017, LB406, § 2.
Even though an insurance company is required to accept the instructions of the sole named insured to cancel the contract, the company still has the obligation to notify all known co-owners of the insured property of the cancellation. Hansen v. U.S.A.A. Casualty Ins. Co., 206 Neb. 147, 291 N.W.2d 715 (1980).
A strict compliance by the insurer with a policy provision for notice is essential to effect a cancellation by such notice, and ambiguities in the notice will be resolved in favor of the insured. Stilen v. Cavalier Ins. Corp., 194 Neb. 824, 236 N.W.2d 178 (1975).
In order to effect a cancellation of a policy by insurer, it was necessary to tender back to the insured the paid unearned premium. Sculley v. Sullivan, 171 Neb. 795, 108 N.W.2d 82 (1961).
If the insurer exercises options to terminate and cancel insurance contracts, the obligation of the insured to pay premium is reduced to the premium earned while the risk was being carried. Bleicher v. Heeter, 141 Neb. 787, 4 N.W.2d 897 (1942).
Insured's statutory right to cancel fire insurance contract becomes part thereof. Johnson v. St. Paul Fire & Marine Ins. Co., 104 Neb. 831, 178 N.W. 926 (1920).
After request for cancellation and repayment of unearned premium by insured, right to unearned premium becomes absolute and is subject to assignment and recovery thereon by assignee. State Ins. Co. v. Farmers' Mut. Ins. Co., 65 Neb. 34, 90 N.W. 997 (1902).
Request for cancellation and claim of unearned premium takes effect from time of its receipt by insurer, with tender of policy. Farmers' Mut. Ins. Co. v. Phoenix Ins. Co., 65 Neb. 14, 90 N.W. 1000 (1902), rev'd on other grounds, 65 Neb. 17, 95 N.W. 3 (1903).
Section applies only to insurance policy in force and insured has no cause of action against insurer for unearned premium where insurer rightfully ends contract for violation of its provisions. Farmers Mut. Ins. Co. v. Home Fire Ins. Co., 54 Neb. 740, 74 N.W. 1101 (1898).