Topics covered:

Introduction

Liberalization clause

Waiver or change of policy provisions

Cancellation

Nonrenewal

Assignment

Subrogation

Death

Introduction

 The 2000 forms contained seven conditions that applied to both the section I and section II coverages, and the 2011 forms contain the same seven conditions.

 A. Liberalization Clause

If we make a change which broadens coverage under this edition of our policy without additional premium charge, that change will automatically apply to your insurance as of the date we implement the change in your state, provided that this implementation date falls within 60 days prior to or during the policy period stated in the Declarations.

This Liberalization Clause does not apply to changes implemented with a general program revision that includes both broadenings and restrictions in coverage, whether that general program revision is implemented through introduction of:

1.A subsequent edition of this policy; or

2.An amendatory endorsement.

 Analysis

 If the insurer, during the policy period or within sixty days prior to the policy period as shown in the policy declarations, adopts a revision that broadens the coverage without additional premium, the broadened coverage applies immediately to the existing policy. The liberalization clause does not apply to changes made through the introduction of subsequent form editions. Changes contained in the 2011 forms will not apply to the 2000 forms; as changes made in the 2000 forms do not apply to the 1991 homeowners forms.

 The liberalization clause states that changes made to forms either through special provisions endorsements or through subsequent editions of the policy may contain both broadenings and restrictions of coverage. Since the clause is intended to benefit the insured policyholder, a change containing both broadenings and restrictions of coverage obviously will not do so. Hence, the statement exists that the liberalization clause does not apply to any changes that include both broadenings and restrictions.