§ 3428. Cancellation of insurance contracts; return premiums; financed\ninsurance premiums.
(a)Except as provided in subsection (e) of this\nsection, whenever an insurance contract made or issued in this state is\ncancelled or otherwise terminated by the insured before the expiration\nthereof in accordance with the terms of such contract, the earned\npremium to be retained by the insurer shall be determined by the\napplicable rate filing, if any, otherwise in accordance with the\nprovisions of such contract.\n (b) No authorized insurer or its agent may knowingly accept payment of\npremiums, for an insurance contract made or issued in this state,\nadvanced under a premium finance agreement as defined in section five\nhundred fifty-four of the banking law by or for any person, firm,\ncor
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§ 3428. Cancellation of insurance contracts; return premiums; financed\ninsurance premiums. (a) Except as provided in subsection (e) of this\nsection, whenever an insurance contract made or issued in this state is\ncancelled or otherwise terminated by the insured before the expiration\nthereof in accordance with the terms of such contract, the earned\npremium to be retained by the insurer shall be determined by the\napplicable rate filing, if any, otherwise in accordance with the\nprovisions of such contract.\n (b) No authorized insurer or its agent may knowingly accept payment of\npremiums, for an insurance contract made or issued in this state,\nadvanced under a premium finance agreement as defined in section five\nhundred fifty-four of the banking law by or for any person, firm,\ncorporation or association who is not authorized either to engage in the\nbusiness of a premium finance agency or to make loans for the purpose of\nfinancing insurance premiums in accordance with the banking law, or to\ninclude an amount for insurance in a retail instalment contract or\nobligation in accordance with the personal property law.\n (c) No authorized insurer shall honor a power of attorney or other\nauthority to cancel an insurance contract executed by an insured in\nconnection with insurance premium financing, except in accordance with\nsection five hundred seventy-six of the banking law. Voluntary\nadvancement of a premium to the insurer by an agent or broker, where no\nadditional charge over and above the premium has been imposed upon the\ninsured and the insured has not signed a note or other obligation to pay\nthe premium shall not be construed to be within the meaning of insurance\npremium finance agreement as defined in article twelve-b of the banking\nlaw.\n (d) Whenever an insurance contract the premiums for which are advanced\nunder a premium finance agreement as defined in section five hundred\nfifty-four of the banking law, is cancelled, the insurer or insurers\nwithin a reasonable time not to exceed sixty days after the effective\ndate of the cancellation shall return whatever gross unearned premiums\nare due under the insurance contract or contracts to the bank, lending\ninstitution, premium finance agency or sales finance company, for the\nbenefit of the insured.\n (e) Whenever an insurance contract, issued by or on behalf of an\nauthorized insurer or insurers, the premiums for which are advanced\nunder a premium finance agreement as defined in section five hundred\nfifty-four of the banking law, is cancelled, upon such cancellation the\nauthorized insurer or insurers shall return the gross unearned premiums\ndue under the insurance contract or contracts, on a pro rata basis to\nthe bank, lending institution, premium finance agency or premium finance\ncompany, for the benefit of the insured, provided, however, that such\nauthorized insurer or insurers shall be entitled to retain a minimum\nearned premium on the policy of ten percent of the gross premium or\nsixty dollars, whichever is greater.\n