In 2003, the Soldiers and Sailors Civil Relief Act was rewritten, and the name changed to Servicemembers Civil Relief Act. Basically the act applies to any service members including reservists and National Guard members that are called to active duty.
Accountants, doctors, lawyers, and some other professionals can ask in writing that their insurance company suspend their professional liability policy while they’re on active duty. Federal law requires insurance companies to cancel the coverage and to reinstate it if a service member requests reinstatement within 30 days of return.
Service members don’t have to pay premiums during the cancellation and could get money back if they’ve already paid the premiums. As with any claims-made coverage you should not cancel your liability coverage as you won’t have any liability protection while the coverage is canceled.
It also caps the interest rate that can be charged on a finance premium contract to 6% suspending payments until the member active service has ended.
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Lee Norcross, MBA, CPCU Managing Director, CEO (616) 940-1101 Ext. 7080 |
