OGC Op. No. 07-12-11
The Office of General Counsel issued the following opinion on December 27, 2007, representing the position of the New York State Insurance Department.
RE: Proof of Mailing of Cancellation Notices
Does the New York Insurance Law or the regulations promulgated thereunder specify what constitutes a certified mailing of a cancellation notice for commercial automobile insurance and workers’ compensation insurance?
No. Neither the Insurance Law nor the regulations promulgated thereunder require that a cancellation notice be mailed certified, or otherwise specify what constitutes proof of a certified mailing for either commercial automobile insurance or workers’ compensation insurance. However, New York Workers Compensation Law § 226(5) (McKinney 2006) sets forth a certified or registered mail, return receipt requested requirement for a workers’ compensation insurance cancellation notice if such notice is served by mail.
The question is of a general nature, without reference to particular facts.
New York Insurance Law § 3426 (McKinney 2007) is relevant to the inquiry. It sets forth cancellation and renewal provisions for most commercial lines property/casualty insurance, and provides in pertinent part as follows:
(b) During the first sixty days a covered policy is initially in effect, except for the bases of cancellation set forth in paragraph one, two or three of subsection (c) of this section, no cancellation shall become effective until twenty days after written notice is mailed or delivered to the first-named insured at the mailing address shown in the policy and to such insured’s authorized agent or broker.
(c) After a covered policy has been in effect for sixty days unless cancelled pursuant to subsection (b) of this section, or on or after the effective date if such policy is a renewal, no notice of cancellation shall become effective until fifteen days after written notice is mailed or delivered to the first-named insured and to such insured’s authorized agent or broker, and such cancellation is based on one or more of the following:
* * *
(5) Written notice of cancellation in accordance with this subsection shall be mailed or delivered to the first-named insured, at the address shown on the policy, and to the insured’s authorized agent or broker.
Neither the Insurance Law nor the regulations promulgated thereunder require a cancellation notice to be mailed certified. Thus, there is no specific description of what constitutes proof of a certified mailing, and the Insurance Department offers no opinion as to what a court may consider to be a valid mailing of a commercial lines insurance cancellation notice.1
However, the cancellation procedures set forth in Insurance Law § 3426 are not applicable to workers’ compensation insurance. Workers Compensation Law § 226(5) sets forth cancellation requirements, which include mailing procedures, for workers’ compensation insurance as follows:
No contract of insurance issued by an insurance carrier providing benefits to be paid under this article shall be cancelled within the time limited in such contract for its expiration unless notice is given as required in this section. When cancellation is due to non-payment of premiums such cancellation shall not be effective until at least ten days after a notice of cancellation of such contract, on a date specified in such notice, shall be filed in the office of the chairman and also served on the employer. When cancellation is due to any reason other than non-payment of premiums such cancellation shall not be effective until at least thirty days after a notice of such contract, on a date specified in such notice, shall be filed in the office of the chairman and also served on the employer; provided, however, in either case that if insurance with another insurance carrier has been obtained which becomes effective prior to the expiration of the time stated in such notice, the cancellation shall be effective as of the date of such other coverage. Such notice shall be served on the employer by delivering it to him or by sending it by certified or registered mail, return receipt requested, addressed to the employer at his or its last known place of business; provided that, if the employer be a partnership, then such notice may be given to any one of the partners, and if the employer be a corporation then the notice may be given to any agent or officer of the corporation upon whom legal process may be served, provided, however, the right to cancellation of a policy of insurance in the state fund shall be exercised only for nonpayment of premiums or as provided in section ninety-four of this chapter.
Therefore, a workers’ compensation insurance policy cancellation notice must be served on an employer by certified or registered mail, return receipt requested if such notice is not delivered to the employer. There are no further specifications set forth in the Workers Compensation Law related to the mailing of a cancellation notice.
For further information you may contact Associate Counsel Alexander Tisch at the New York City Office.
1 There is relevant case law on insurance proof of mailing issues. The insurer has the burden of proving the validity of its timely cancellation of an insurance policy. See Badio v. Liberty Mut. Fire Ins. Co., 12 A.D.3d 229, 785 N.Y.S.2d 52 (1st Dept. 2004). Proof of proper mailing gives rise to a presumption that the item was received by the addressee; the presumption may be created by either proof of actual mailing or proof of a standard office practice or procedure designed to ensure that items are properly addressed and mailed. See Residential Holding Corp. v. Scottsdale Ins. Co., 286 A.D.2d 679, 729 N.Y.S.2d 776 (2nd Dept. 2001). Such proof may include a mailing ledger signed and date-stamped by a U.S. Postal Service employee, which would give rise to rebuttable presumption of delivery. Id. at 680, 729 N.Y.S.2d at 778.