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Notice to New Jersey Policyholders

By: Topa Insurance Company
Posted on: June 8, 2020

Notice to New Jersey Policyholders

We have received a request from the New Jersey Department of Business and Insurance (NJDBI) that all insurance companies offer a 90-day payment grace period for premium payments. As a result, we would like to advise that a policyholder may elect this 90-day emergency grace period to begin retroactively on April 1, 2020 or opt for the grace period to begin on May 1, 2020. During this extended grace period, we will not cancel any insurance policy for nonpayment. Please note the following additional steps we will take if the 90-day grace period is elected:

  • Waive late payment fees otherwise due, and not report late payments to credit rating agencies, during the 90-day period.
  • Allow premiums due but not paid during the 90-day period to be paid over the remainder of the current policy term or up to 12 months in up to 12 equal installments, whichever is longer.
  • Ensure that late payments during the 90-day period are not considered in any future premium calculations at any time (i.e. applicable late payments should not be counted for any rating, pricing, tiering attributes, etc.).
  • This grace period is intended to be applied to all installment payments, including renewal down payments, provided that you (the insured) provide notice to us (the insurer) that you wish to continue coverage.
  • This is not intended to change the terms of the issued policy or be considered a forgiveness of the premium. Rather, it is intended that the insurer grant the policyholder an extended grace period for the payment of premium due without penalty or interest.

Regarding premium financed policies:

Under current law, an insurance PFC may cancel an insurance contract for failure to pay premium upon not less than 10 days' notice. Considering the disruptions caused by COVID-19, Bulletin 2020-17 requires all licensed insurance premium finance companies to provide their clients who are experiencing a financial hardship due to COVID-19 with a 90-day grace period to pay for their insurance premiums. As a result, insurance premium finance companies have also been directed to do the above. 

If you have any questions, please reach out to your agent.

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