                                 CODE OF VIRGINIA

GROUNDS AND PROCEDURE FOR TERMINATION OF POLICY; CONTENTS OF NOTICE; REVIEW BY
COMMISSIONER; EXCEPTIONS; IMMUNITY FROM LIABILITY (§ 38.2-2114)

A. Notwithstanding the provisions of § 38.2-2105, no policy or contract written
to insure owner-occupied dwellings shall be canceled by an insurer unless
written notice is mailed or delivered to the named insured at the address stated
in the policy, or is delivered electronically to the address provided by the
named insured, and cancellation is for one of the following reasons:

   1. Failure to pay the premium when due;

   2. Conviction of a crime arising out of acts increasing the probability that a
   peril insured against will occur;

   3. Discovery of fraud or material misrepresentation;

   4. Willful or reckless acts or omissions increasing the probability that a
   peril insured against will occur as determined from a physical inspection of
   the insured premises;

   5. Physical changes in the property which result in the property becoming
   uninsurable as determined from a physical inspection of the insured premises;
   or

   6. Foreclosure efforts by the secured party against the subject property
   covered by the policy that have resulted in the sale of the property by a
   trustee under a deed of trust as duly recorded in the land title records of
   the jurisdiction in which the property is located.

B. No policy or contract written to insure owner-occupied dwellings shall be
terminated by an insurer by refusal to renew except at the expiration of the
stated policy period or term and unless the insurer or its agent acting on
behalf of the insurer mails or delivers to the named insured, at the address
stated in the policy, or delivers electronically to the address provided by the
named insured, written notice of the insurer&#8217;s refusal to renew the policy
or contract.

C. A written notice of cancellation of or refusal to renew a policy or contract
written to insure owner-occupied dwellings shall:

   1. State the date that the insurer proposes to terminate the policy or
   contract, which shall be at least 30 days after mailing or delivering to the
   named insured the notice of cancellation or refusal to renew. However, when
   the policy is being terminated for the reason set forth in subdivision A 1,
   the date that the insurer proposes to terminate the policy may be less than 30
   days but at least 10 days from the date of mailing or delivery;

   2. State the specific reason for terminating the policy or contract and
   provide for the notification required by the provisions of &#xA7;&#xA7;
   38.2-608 and 38.2-609 and subsection B of &#xA7; 38.2-610. However, those
   notification requirements shall not apply when the policy is being canceled or
   not renewed for the reason set forth in subdivision A 1;

   3. Advise the insured that within 10 days of receipt of the notice of
   termination he may request in writing that the Commissioner review the action
   of the insurer in terminating the policy or contract;

   4. Advise the insured of his possible eligibility for fire insurance coverage
   through the Virginia Property Insurance Association; and

   5. Be in a type size authorized by &#xA7; 38.2-311.

D. Within 10 days of receipt of the notice of termination any insured or his
attorney shall be entitled to request in writing to the Commissioner that he
review the action of the insurer in terminating a policy or contract written to
insure owner-occupied dwellings. Upon receipt of the request, the Commissioner
shall promptly initiate a review to determine whether the insurer&#8217;s
cancellation or refusal to renew complies with the requirements of this section
and of &#xA7; 38.2-2113, if sent by mail or delivered electronically. The policy
shall remain in full force and effect during the pendency of the review by the
Commissioner except where the cancellation or refusal to renew is for reason of
nonpayment of premium, in which case the policy shall terminate as of the date
stated in the notice. Where the Commissioner finds from the review that the
cancellation or refusal to renew has not complied with the requirements of this
section or of &#xA7; 38.2-2113, if sent by mail or delivered electronically, he
shall immediately notify the insurer, the insured, and any other person to whom
notice of cancellation or refusal to renew was required to be given by the terms
of the policy that the cancellation or refusal to renew is not effective.
Nothing in this section authorizes the Commissioner to substitute his judgment
as to underwriting for that of the insurer.

E. Nothing in this section shall apply:

   1. To any policy written to insure owner-occupied dwellings that has been in
   effect for less than 90 days when the notice of termination is mailed or
   delivered to the insured, unless it is a renewal policy;

   2. If the insurer or its agent acting on behalf of the insurer has manifested
   its willingness to renew by issuing or offering to issue a renewal policy,
   certificate or other evidence of renewal, or has otherwise manifested its
   willingness to renew in writing to the insured. The written manifestation
   shall include the name of a proposed insurer, the expiration date of the
   policy, the type of insurance coverage, and information regarding the
   estimated renewal premium;

   3. If the named insured or his duly constituted attorney-in-fact has notified
   the insurer or its agent orally, or in writing, if the insurer requires such
   notification to be in writing, that he wishes the policy to be canceled, or
   that he does not wish the policy to be renewed, or if, prior to the date of
   expiration, he fails to accept the offer of the insurer to renew the policy;

   4. To any contract or policy written through the Virginia Property Insurance
   Association or any residual market facility established pursuant to Chapter 27
   (&#xA7; 38.2-2700 et seq.); or

   5. If an affiliated insurer has manifested its willingness to provide coverage
   at a lower premium than would have been charged for the same exposures on the
   expiring policy. The affiliated insurer shall manifest its willingness to
   provide coverage by issuing a policy with the types and limits of coverage at
   least equal to those contained in the expiring policy unless the named insured
   has requested a change in coverage or limits. When such offer is made by an
   affiliated insurer, an offer of renewal shall not be required of the insurer
   of the expiring policy, and the policy issued by the affiliated insurer shall
   be deemed to be a renewal policy.

F. Each insurer shall maintain, for at least one year, records of cancellation
and refusal to renew and copies of every notice or statement referred to in
subsection E that it sends to any of its insureds.

G. There shall be no liability on the part of and no cause of action of any
nature shall arise against the Commissioner or his subordinates; any insurer,
its authorized representative, its agents, or its employees; or any firm, person
or corporation furnishing to the insurer information as to reasons for
cancellation or refusal to renew, for any statement made by any of them in
complying with this section or for providing information pertaining to the
cancellation or refusal to renew.

H. Nothing in this section requires an insurer to renew a policy written to
insure owner-occupied dwellings, if the insured does not conform to the
occupational or membership requirements of an insurer who limits its writings to
an occupation or membership of an organization.

I. No insurer or agent shall refuse to renew a policy written to insure an
owner-occupied dwelling, solely because of any one or more of the following
factors:

   1. Age;

   2. Sex;

   3. Residence;

   4. Race;

   5. Color;

   6. Creed;

   7. National origin;

   8. Ancestry;

   9. Marital status;

   10. Sexual orientation;

   11. Gender identity;

   12. Lawful occupation, including the military service; however, nothing in
   this subsection shall require any insurer to renew a policy for an insured
   where the insured&#8217;s occupation has changed so as to increase materially
   the risk;

   13. Credit information contained in a &#8220;consumer report,&#8221; as
   defined in the federal Fair Credit Reporting Act, 15 U.S.C. &#xA7; 1681 et
   seq., bearing on a natural person&#8217;s creditworthiness, credit standing or
   credit capacity. If credit information is used, in part, as the basis for the
   nonrenewal, such credit information shall be based on a consumer report
   procured within 120 days from the effective date of the nonrenewal;

   14. Any claim resulting primarily from natural causes;

   15. One or more claims that were incurred more than 60 months immediately
   prior to the expiration of the current policy period; or

   16. Any inquiry from an insured about his insurance coverage or policy
   provisions. For purposes of this subdivision, &#8220;inquiry&#8221; means a
   written or oral communication by an insured seeking information regarding
   coverage or policy provisions that does not notify the insurer of a loss,
   incident or accident, and that does not provide information indicating an
   increase in the hazard insured against. An insurer shall not report any
   inquiry as a claim to a loss history database maintained by a consumer
   reporting agency or insurance support organization.
   				Nothing in this section prohibits any insurer from setting rates in
   accordance with relevant actuarial data.

J. No insurer shall cancel or refuse to renew a policy written to insure an
owner-occupied dwelling because an insured under the policy is a foster parent
and foster children reside at the insured dwelling.

HISTORY: 1972, c. 110, § 38.1-371.2; 1975, c. 350; 1978, c. 441; 1983, c. 371;
1986, c. 562; 1990, c. 293; 1995, c. 3; 1996, c. 237; 1998, c. 142; 2003, cc.
543, 553; 2004, c. 300; 2005, c. 872; 2008, cc. 58, 221; 2009, cc. 215, 442;
2013, c. 257; 2020, c. 1137.