Nebraska Revised Statute 44-516

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44-515
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44-517
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44-516. Automobile liability policy; notice of cancellation; reason for cancellation.

(1) No notice of cancellation of a policy to which section 44-515 applies shall be effective unless mailed by registered or certified mail to the named insured at least thirty days prior to the effective date of cancellation, except that if cancellation is for nonpayment of premium, at least ten days' notice of cancellation accompanied by the reason therefor shall be given. The requirements of this subsection shall apply to a cancellation initiated by a premium finance company for nonpayment of premium.

(2) Unless the reason accompanies or is included in the notice of cancellation, the notice of cancellation shall state or be accompanied by a statement that upon written request of the named insured, mailed or delivered to the insurer not less than twenty-five days prior to the effective date of cancellation, the insurer will specify the reason for such cancellation. The insurer shall, upon such written request of the named insured, mailed or delivered to the insurer not less than twenty-five days prior to the effective date of cancellation, specify in writing the reason for such cancellation. Such reason shall be mailed or delivered to the named insured within five days after receipt of such request.

(3) For purposes of sections 44-514 to 44-521:

(a) An insurer's substitution of insurance upon renewal which results in substantially equivalent coverage shall not be considered a cancellation of a policy; and

(b) The transfer of a policyholder between insurers within the same insurance group shall be considered a cancellation only if the transfer results in policy coverage or rates substantially less favorable to the insured.

(4) Subsections (1) and (2) of this section shall not apply to nonrenewal.

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Annotations

Failure of an insurer to send notice of cancellation for nonpayment of premiums to other individuals with an interest in an insured vehicle does not make cancellation ineffective as to the named insured who does receive notice in conformity with subsection (1) of this section. City of Columbus v. Swanson, 270 Neb. 713, 708 N.W.2d 225 (2005).

Purpose of the statutory scheme under sections 44-514 to 44-521 was to ensure that notice is given when cancellation is the remedy utilized and to limit the circumstances under which cancellation may be had. Glockel v. State Farm Mut. Auto. Ins. Co., 224 Neb. 598, 400 N.W.2d 250 (1987).

This section does not require notice in the case of an automatic termination by expiration of the policy period. This section, by its terms, does not apply if the insurer has manifested its willingness to renew or if nonrenewal is due to nonpayment of premium. Sampson v. State Farm Mut. Ins. Co., 205 Neb. 164, 286 N.W.2d 746 (1980).

This section requires registered or certified mail for every cancellation notice regardless of the period the policy has been in force. Saunders v. Mittlieder, 195 Neb. 232, 237 N.W.2d 838 (1976).