PARRIS N. GLENDENING, Governor                              Ch. 708

[(c) A cancellation under this section shall be made as if the notice of cancellation
had been submitted by the insured, but without requiring the return of the policy.]

23-404.

(a)     All statutory, regulatory, and contractual restrictions that provide that the
insured may not cancel an insurance contract unless notice is given to a governmental
agency, mortgagee, or other third party shall apply to a cancellation made under this
subtitle.

(b)     If an insurer is required under subsection (a) of this section to give notice on
behalf of itself or the insured, the insurer shall:

(1)     give notice to the governmental agency, mortgagee, or other third party;
and

(2)     compute the effective date of cancellation from the day the insurer
receives the notice of cancellation from the premium finance company.

23-405.

(a)     (1) Whenever an insurance contract is canceled in accordance with this
subtitle, the insurer shall return any gross unearned premiums that are due under the
insurance contract, less agents' earned commissions, to the premium finance company for
the account of the insured within a reasonable time not exceeding [60] 45 days after:

(i) receipt by the insurer of [the] A WRITTEN notice of cancellation
FROM THE PREMIUM FINANCE COMPANY; or

(ii) completion of any payroll audit necessary to determine the amount
of premium earned while the insurance contract was in force.

(2)     A RETURN PREMIUM SHALL BE SUBJECT TO ANY MINIMUM EARNED
PREMIUM STATED IN THE INSURANCE CONTRACT.

(3)     An audit under paragraph (1)(ii) of this subsection shall be performed
within [60] 45 days after the insurer receives the notice of cancellation.

(b)     (1) [After the insurer returns to the premium finance company any gross
unearned premiums that are due under the insurance contract, the premium finance
company shall refund to the insured the amount of unearned premium that exceeds any
amount due under the premium finance agreement.] IF CREDITING OF RETURN
PREMIUMS TO THE ACCOUNT OF THE INSURED CAUSES A SURPLUS OVER THE
AMOUNT DUE FROM THIS INSURED, THE PREMIUM FINANCE COMPANY SHALL
REFUND THE SURPLUS TO THE INSURED AS SOON AS REASONABLY POSSIBLE NOT
EXCEEDING 15 BUSINESS DAYS AFTER THE PREMIUM FINANCE COMPANY RECEIVES
ALL RETURN PREMIUMS.

(2) A premium finance company need not make a refund to the insured if
the amount of the refund would be less than $5.

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