Excuse My Language! Michigan Court of Appeals Examines the Impact of the Cautionary Warning Requirement on Policy Cancellations

In Citizens Insurance Company of America v Jerry Sholtey and Auto Club Insurance Association, (unpublished COA 10-25-18) the MI COA examined the impact of MCL 500.3020(6) as it relates to cancellation of no fault insurance policies. The Court’s opinion highlighted the importance of including cautionary language in a policy cancellation, and shows the impact the rule has on insurance companies that fail to include the cautionary language. In the instant case, Defendant ACIA was held responsible for $381,050.27 in no-fault benefits due to its failure to include cautionary language in the initial policy cancellation notice.

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