Carrier Refused Application after RTA Stamped

    Posted by MAIA on Jul 30, 2020 12:00:00 AM

    This question was answered based upon current rules, regulations & statutes in effect on July 25, 2020

    We stamped a commercial RTA for one of our clients  and submitted a change request to the carrier adding the vehicle to the policy. It has been 5 days and the carrier just notified us that they will not add the vehicle to the policy and there is no coverage. The carrier stated that just because we stamp an RTA does not mean that they need to cover the vehicle. Is that true? I can understand issuing  legal notice to get off the vehicle but not to add it at all. Who would be responsible if there was an accident?

    Thanks for you input.


    Irene Morrill:  Really. On a policy that is already in existence. Did the insured buy a vehicle that has a different activity or something like a Tesla that is overpriced? Do they have an excluded or ineligible vehicle list and that vehicle was on it ?

    I would “suggest” to the carrier that you are an agent and have stamped the registration and it has gone through the RMV so therefore it IS insured and they need to issue a cancellation for the policy. If this is the first 90 days of policy they can cancel for any reason.  If its been longer than 90 days they can only cancel for:

    See the cancellation provision from MM 99 11 MA amendatory endorsement:

    A. Cancellation

    You can cancel all or any part of the insurance at any time by giving us or your agent at least 20 days written notice.

    We can cancel all or any part of the insurance if:

    1. You have not paid your premium on this policy.

    2. We find that you were responsible for fraud or material misrepresentation when you applied for this policy or any extension or renewal of it.

    3. Your driver's license or auto registration has been u nder suspendion or revocation during the policy period.

    Otherwise they can set the policy up for non-renewal.

    I would suggest that the client is going to file a consumer complaint with the MA DOI and/or the Attorney General’s office.  Both forms are attached.

    This document is not a legal opinion and should not be relied upon as such. The intent of this document is to provide a general background regarding the topic or topics discussed, not to provide legal advice. Producers and agencies should consult an attorney regarding specific situations and specific questions with respect to the topic or topics covered in this document. Neither the Massachusetts Association of Insurance Agents, Number One Insurance Agency nor any of its employees shall be responsible for any errors or omissions regarding any statements made in this document, nor any errors or omissions regarding any statutes, regulations, court rules, and/or any other government documents cited in this document.

    Topics: Registry, 2020

    Keep Reading!

    Previous Post Policy Non-Renewal
    Next Post Travel Trailer and No Auto Policy


    *Denotes required field.