The Vermont Statutes Online
The Vermont Statutes Online have been updated to include the actions of the 2023 session of the General Assembly.
NOTE: The Vermont Statutes Online is an unofficial copy of the Vermont Statutes Annotated that is provided as a convenience.
Title 8 : Banking and Insurance
Chapter 157 : Transfer and Assumption of Insurance Contracts
(Cite as: 8 V.S.A. § 8205)-
§ 8205. Policyholder rights
(a) Policyholders shall have the right to accept or reject the transfer and novation of their contracts of insurance. Policyholders electing to reject the assumption transaction shall return to the transferring insurer the pre-addressed, postage-paid response card or other written notice and indicate thereon that the assumption is rejected (collectively referred to as the “Response Card”).
(b) Payment of any premium to the assuming company during the 12-month period after notice is received shall be deemed to indicate the policyholder’s consent to the transfer to the assuming insurer and a novation shall be deemed to have been effected, provided that the premium notice states in a manner calculated to give the policyholder notice that payment of the premium to the assuming insurer shall constitute acceptance of the transfer, unless the policyholder reserves the right to reject the transfer. The premium notice shall also provide a method for the policyholder to pay the premium while reserving the right to reject the transfer. With respect to any home service business or any other business not using premium notices, the Commissioner must approve the disclosures and procedures used to inform policyholders of the proposed assumption or transfer, which notice, at a minimum, must meet the requirements set forth in section 8204 of this title.
(c) After no fewer than 12 months from the mailing of the initial notice of transfer required under subsection 8204(a) of this title, if positive consent to, or rejection of, the transfer and assumption has not been received as provided in subsection (a) of this section or consent has not been deemed to have occurred under subsection (b) of this section, the transferring company shall send to the policyholder a second and final notice of transfer as provided in section 8204 of this title. If the policyholder does not accept or reject the transfer during the two-month period immediately following the date on which the transferring insurer mails the second and final notice of transfer, the policyholder’s consent will be deemed to have occurred and novation of the contract will be effected. With respect to the home service business or any other business not using premium notices, the 12- and two-month periods shall be measured from the date of delivery of the notice of transfer pursuant to section 8204 of this title.
(d) The transferring insurer will be deemed to have received the response card on the date it is postmarked. A policyholder may also send his or her response card by facsimile or other electronic transmission or by registered mail, express delivery or courier service, in which case the response card shall be deemed to have been received by the assuming insurer on the date of actual receipt by the transferring insurer. (Added 1993, No. 235 (Adj. Sess.), § 7.)
