Automobile insurance: notice of cancellation.

Senator Rubio's automobile insurance legislation extends California's required notice period for policy cancellations from 20 to 30 days, while maintaining the existing 10-day notice requirement for nonpayment of premiums. The measure modifies Section 662 of the Insurance Code to require insurers to provide explicit reasons for cancellation due to nonpayment and allows policyholders to request written explanation if not initially provided.

The bill introduces new provisions governing cancellations due to nonpayment, specifying that such cancellations take effect only if the policyholder fails to resolve the payment issue within the 10-day notice period. It also permits insurers to deliver cancellation notices to lienholders electronically, provided they have obtained prior consent. The legislation excludes policy nonrenewals from these notice requirements.

These modifications to cancellation procedures affect multiple stakeholders within California's auto insurance market. Insurers must adapt their notification systems and administrative processes to accommodate the extended timeline and enhanced documentation requirements. Policyholders receive additional time to address potential cancellations, while lienholders gain the option to receive notices through electronic channels.