In Svetlana Spielberg vs. Progressive Select Insurance Company, the Fourth District Court of Appeal confirmed that an insurer’s duty to notify its insured of a policy’s cancellation is contingent on the type of policy and the reason for the cancellation. The Fourth DCA addressed the issue after Progressive denied the insured-plaintiff coverage for an auto accident on the basis that the plaintiff’s son, also a named insured under the policy, cancelled the policy prior to the accident. Plaintiff sought a declaratory judgment arguing that the cancellation was ineffective because Progressive allegedly failed to provide notice as prescribed by statute.

In affirming the trial court’s determination at summary judgment that Progressive did not have a duty to notify the insured-plaintiff of the cancellation, the Fourth DCA looked to the controlling statutes and the policy language. In reaching its ruling, the Fourth DCA dissected Florida Statute sections 627.728 and 627.7281. The Fourth DCA reasoned that Florida Statute section 627.728 requires notice of cancellation of a typical motor vehicle insurance policy insuring private vehicles for personal use only in instances of nonpayment of premium, misrepresentation, fraud or license suspension or revocation. Given that the delineated reasons for providing notice were inapplicable, Progressive was not required to notify the plaintiff of the cancellation. 

The Fourth DCA rejected the plaintiff’s argument that Florida Statute section 627.7281 required Progressive to provide notice of the cancellation. The section reads in pertinent part as follows: “An insurer issuing a policy of motor vehicle insurance not covered under the cancellation provisions of s. 627.728 shall give the first-named insured notice of cancellation . . .” The Fourth DCA examined the plain language of Florida Statute section 627.7281 to determine that the section is inapplicable given that the plaintiff’s policy was already covered by Florida Statute section 627.728. In addition, the Fourth DCA noted that the Fifth and First DCAs previously interpreted both sections to require notice only where the insurer – as opposed to the insured – initiates cancellation of the policy.

After analyzing the application statute sections, the Fourth DCA turned to the policy language. The policy read, in pertinent part, that any insured “may cancel [the] policy during the policy period by calling or writing [Progressive] and stating the future date [of cancellation]” and that, “[t]he action of one named insured will be binding on all persons provided coverage under [the] policy.” Accordingly, the cancellation by the plaintiff’s son, a named insured, was binding on the plaintiff.

The Fourth DCA’s decision reminds insurers that they must consider the type of insurance policy and the reason for the policy’s cancellation in deciding whether or not notification is required. Additionally, as evidenced by the Fourth DCA’s reliance on the policy language, it is crucial for insurers to spell out policy cancellation procedure in the policy.