In response to the recent catastrophic seismic events, the Governor of Puerto Rico issued an Emergency Order (EO-2020-001) on January 7, 2020 declaring a state of emergency that continues until further notice
As a result, the Insurance Commissioner published Ruling Letters that provide a temporary postponement on cancellations of insurance policies. While the state of emergency is in effect, property and casualty insurers may not cancel policies for non-payment of premiums within 30 days of the payment due date. Additionally, insurers may not deny renewal of policies requested by the insured for non-payment of premium if the premium payment is made within 30 days from the effective date of the renewal.
While the emergency declaration is in effect, all cancellation notices issued on policies for lack of payment should be withdrawn by the insurer. Policies cancelled by the insured are excluded from these provisions.
Proctor encourages clients to review their internal insurance processing procedures to ensure policy reinstatements will be handled accordingly. If Proctor currently provides insurance tracking services for your organization, you do not need to take action as we administer this process on your behalf.
Many residents of Puerto Rico have been displaced or otherwise forced to abandon their properties at this time. The Insurance Commissioner reminds that all insurers are prohibited from denying any claim of an insured who has been relocated from their home or property or has been forced to temporarily vacate under reasonable circumstances, which would otherwise be covered, because the property was unoccupied or vacant. Insureds who abandoned their properties permanently before January 6, 2020 are excluded from this provision.
The aforementioned guidelines will remain in effect until such a time when the Emergency Order is lifted or when the Insurance Commissioner issues a Ruling Letter to revise or remove this guidance, whichever occurs first.
Proctor will continue to monitor this topic and provide updates as they occur.