Grace Period – P&C

By Hanson & Ryan, Inc.

Calculating bills with calculator, glasses and money in a jar

On March 9, 2020, Governor Phil Murphy declared a state of emergency and public health emergency through the issuance of Exec. Order No. 103 (March 21, 2020) ___ N.J.R. ___ (“EO 103”) to contain the spread of the Coronavirus (“COVID-19”) pandemic. Governor Murphy later directed New Jersey residents to remain in their homes unless leaving was essential through the issuance of Exec. Order No. 107 (March 21, 2020) ___ N.J.R. ___ (“EO 107”). These Executive Orders were issued to contain the spread of the COVID-19 pandemic. On April 9, 2020, Governor Murphy issued Executive Order No. 123 (“EO 123”). EO 123 directed insurers transacting property and casualty to refrain from cancelling any policy or contract for nonpayment for a period of time as directed by the Commissioner of the Department of Banking and Insurance (“Commissioner”); to exercise appropriate forbearances on collection documentation; to amortize any unpaid payments over the remainder of the policy term or a period of up to 12 months, as appropriate, as directed by the Commissioner; and to refrain from seeking recoupment of any unpaid claims paid during the emergency grace period. The Department of Banking and Insurance (“Department”) is issuing this Bulletin to direct all property and casualty insurance carriers to extend a grace period to their insureds as set forth herein.

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