Updated November 1, 2022, to reflect the ultimate resolution of the case author W. Joel Baker describes here.
Most of us are aware that if we cancel our insurance policy, we receive a refund. That refund in legal terms is known as “unearned premium.” How much of a refund we receive and how we receive it depends on many factors. Some of those factors are:
With the recent dramatic increase in fuel costs, fewer available loads and declining rates, some truck owners have chosen to either suspend their trucking operations, lease to large carriers or shut down permanently. That has resulted in an increase of FMCSA voluntary revocation applications by truck owners. For that reason, I am focusing on factors three, four, five and six.
With a long history as an independent owner-operator myself, I personally have voluntarily revoked my authority multiple times for military deployments (I’m a retired U.S. Army National Guardsman) and other personal reasons. Each time, the three insurance carriers I had at those times, without any hesitation or delay, canceled my insurance policies and issued my refund with an effective date that matched the effective date of the voluntary revocation of my authority.
In contrast to my very good experience as an independent owner-operator, it has been my recent discovery as an insurance agent that not all insurance companies act ethically, timely or willingly when a truck owner requests to cancel their policy. Due to Department of Insurance licensing regulations, I’m unable to disclose the name of the insurance company that prompted this article. However, I will disclose the inexcusable bad behavior and the bullying tactics used by the insurance company. I will also provide information and guidance to anyone who believes they may have been inappropriately denied their full unearned premium refund by an insurance company.
Understanding when the MCS-90 endorsement can be removed from a policy and how that impacts BMC-91 or BMC-91X filings is fundamental to understanding when a policy can be canceled.
