Once you select your state and Lifecycle Parameters, you can configure the Cancellation settings.
Configure the Cancellation settings
- In the BriteCore menu, select Settings.
- In the Settings menu, select Modules, and then select Policies.
- On the Policies screen, under Policy Lifecycle, select Edit.
- In the Confirm dialog box, select Yes to save your data before proceeding.
- At the top of the Policy Lifecycle screen, select the Choose a State dropdown list, and then select the applicable state.
- Select the Cancellation tab, and then configure the following sections:
- Minimum Earned Premium
- Cancellation Reasons
- After you configure the cancellation settings, select Save and Exit, and then select either Save or Save and Exit at the top or bottom of the screen.
Cancellation settings descriptions
The Options section contains three settings:
Length (In Days) of Cancellation Pending Notice: You can define the number of days a policy is in underwriting cancellation prior to the policy canceling as outlined by your state regulations and business policies.
Unless policy category <type the Policy Category> has option <type the Option> selected, then use <Select number of days from the dropdown> days: You can customize the length of cancellation pending notice per specific policy category and option. This setting is specific to policy type since different policy types will often have different category options. Enter the category name, option name, and number of days.
For new business, the Length of the Cancellation Pending Notice is <select the number of days from the dropdown> Days for the first <select the number of days from the dropdown> Days the policy is effective: This setting allows a company to cancel a newly issued policy within a different number of days than the regular underwriting cancellation. In some states, you only have to give 10 days notice within the first 60 days of the effective date, for example.
Allow Mortgagee Extension for <select the number of days from the dropdown> Days: You can add an extension to cancellations to accommodate mortgagees. When used, BriteCore will report a cancel date of X more days via InsVista to the mortgagee. BriteCore, however, will still process the policy on the original cancel date. In other words, BriteCore processes the policy as if there is no extension. The extension is reported to the mortgagee through InsVista only. When the setting is enabled, a Grant Mortgagee Extension of Cancellation checkbox appears on every policy. When a mortgagee is added to a policy, the extension automatically applies via the checkbox. To remove the extension, uncheck the box on the policy.
Cancel policy back to invoice due date upon cancellation: When an invoice is unpaid, BriteCore will cancel the policy on the invoice’s cancel date. This setting will cancel a policy back to the invoice due date once the cancellation date is reached, thereby reducing the amount of earned unpaid premium on the account.
On rewrite, automatically transfer return premium to the newly rewritten policy: When a policy is rewritten, the policy being rewritten is canceled. If a return premium generates as a result of the cancellation, this setting will automatically transfer the return premium to the new policy.
On a rewritten policy, keep installment dates in sync with old policy upon commit: When a policy is rewritten to a new policy, this setting will attempt to keep the bill dates in sync from the old to the new policy. It is generally advised to not use this setting as rewritten policies rarely have the same term.
Cancellation Pending will carry to future terms when cancel date falls in future term: This setting allows Cancellation Pending statuses on a previous term to carry over to a future term if the cancellation date falls within the newer term. With the setting is turned off (unchecked), the renewal term will show as Active instead of Cancellation Pending when the cancel date crosses into the renewal term’s effective date.
With the setting is turned on (checkbox checked), the Cancellation Pending Policy Status, Cancel Date, and Cancel Reason will carry to the renewal term when the Cancel Date crosses into the renewal term.
The Documents section contains the following settings:
Print Confirmation of Cancellation at Policy End Date: This will always print a Confirmation of Cancellation when a policy reaches its Cancellation Date.
On renewals, suppress the Confirmation of Cancellation: When this setting is enabled, users can enter dates outside of the policy term, and BriteCore generates a Notice of Cancellation for Non-Pay every time you cancel a policy with the exception of two instances:
- When a policy cancels prior to the renewal term’s effective date, the system will generate a Notice of Cancellation for Non-Pay only for the current term. When there is an outstanding debit in the current term, the Notice of Cancellation for Non-Pay will refer to the current term and not the renewal. The renewal wouldn’t be effective when the prior term is canceled. When the setting isn’t enabled, the system will generate two Notices of Cancellation for Non-Pay, one for each term.
- When a policy cancels for non-pay and the only unpaid balance is for the renewal invoice. If a policy cancels for non-pay of a Renewal Invoice and all other debts in the current term are paid off, the system will generate a Notice of Cancellation for Non-Pay on the due date of the invoice. In this case, a Confirmation of Cancellation notification won’t be sent out on the cancel date. For example, let’s say a policy is in a current term from 1/19/2021–1/19/2022, and has been renewed for 1/19/2022–1/19/2023. All debts on the 2021–2022 term have been paid off, and a Renewal Invoice has been generated with a Bill date of 11/25/2021. Due date of 1/19/2022 and Cancel date of 2/1/2022 The insured does not pay the bill on 1/19/2022, so a Notice of Cancellation for Non-Pay is generated. By the cancel date of 2/1/2022, the bill still isn’t paid, but no Confirmation of Cancellation is generated because the only unpaid debt is the renewal invoice. In this case, Custom Deliverables could be used to generate a Confirmation of Cancellation.
Consider the following question: Do you want to send notice to the insured that the pending cancellation on their policy has processed when the only outstanding amount due is for the renewal term? And/or do you need the ability to send an invoice for a policy term where the due date and date the policy will cancel if the invoice isn’t paid are outside the policy term?
Print Cancellation Invoice at Policy End Date: The Billing Statement issues an earned but unpaid statement. Rather than use this deliverable, clients can elect to add an Earned Premium Statement at the bottom of the Confirmation of Cancellation to avoid printing both a Cancellation Billing Statement and a Confirmation of Cancellation.
Enforce Underwriting Cancel Date IFF NonPay Cancel is Later Than UW: This setting allows clients to enforce underwriting and non-pay cancel dates. When there is an overlapping non-pay cancellation on an active underwriting pending cancellation, the setting will place a higher priority on the underwriting cancellation if it has a cancel date prior to the non-pay date. The notices of cancellation will state that a payment or resolution of one cancellation doesn’t override the other cancellation.
Minimum Earned Premium
Minimum Earned Premium (MEP), or Minimum Retained Premium, is the smallest amount of money an insurance company is willing to accept for writing an insurance policy. This section allows clients to define and configure a minimum amount of earned premium.
Note: For a given cancelation date, if both the statically configured MEP and a calendar-based MEP are available, then the highest of those two amounts is elected as the effective MEP.
You can configure the Minimum Earned Premium section in two ways:
- Set up a static MEP
- Set up a calendar-based MEP
Set up a static Minimum Earned Premium
Minimum Amount: Flat amount of earned premium that must be retained on policy.
Start Date: The date that MEP in effect. Typically, MEP can’t apply (calendar or static) to policies bound in the past because those policies don’t include a form of MEP upon cancellation, which means legally they can’t charge MEP on those past policies. Only policies with an inception date after a specified date should be subject to MEP calculation. All the other policies should simply go under 0 MEP.
Set up a calendar-based Minimum Earned Premium
Minimum Percentage Collected by Calendar Date Range: This allows you to specify a % MEP during a specific timeframe. For coastal writers, this can vary based on hurricane season or other state requirements. To set up a calendar-based MEP:
- Select + next to Add Calendar.
- Select the Initial Date from the date picker.
- Select the Final Date from the date picker.
- Enter the MEP Percentage for the date range.
- Repeat the steps to add additional date ranges.
Refer to the documentation on how to apply minimum earned premium when canceling policies.
Provide a list of all cancellation reasons a user may choose from when canceling a policy. To add a cancellation reason:
- Select + next to Add Cancellation Reason.
- Type the cancellation reason in the text box. Select anywhere outside the box to exit the edit mode.
- To edit an existing cancellation reason, select the pencil icon next to the reason. Edit the text. Select anywhere outside the box to exit the edit mode.
- To delete an existing cancellation reason, select the X icon next to the reason. Select OK in the Confirm dialog box.
The fees section allows you to enter the (Dollar amount assessed when non-pay cancellation pending policy is canceled).
Important: Once you configure the cancellation sections, select Save and Exit, and then select either Save or Save and Exit at the top or bottom of the screen.