Property and casualty fundamentals (insurable interest, indemnity, negligence, policy structure, valuation) are covered in the national basics guides. This guide covers Ohio rules that apply across property and casualty lines: cancellation and nonrenewal, rate and form filing, the claims rule, fire-loss rules, surplus lines, market assistance plans and the guaranty association. Citations are to the Ohio Revised Code (R.C.) and Administrative Code (O.A.C.). Auto cancellation rules are in the Ohio Personal Auto guide.

Commercial cancellation and nonrenewal (R.C. 3937.25 to 3937.28)

• After 90 days, a commercial policy can be canceled only for listed reasons: nonpayment, fraud, moral hazard, a substantial change in the risk, loss of reinsurance, failure to correct safety violations or follow loss control recommendations, or a Superintendent finding that continuing the policy creates a hazard (R.C. 3937.25(B)).
• Notice: cancellation takes effect at least 30 days after mailing, or 10 days for nonpayment. It goes to the insured and the agent, with the policy number, dates and reason (3937.25(C), (D)). A nonpayment notice may be included with the bill.
• Nonrenewal: a nonrenewal notice mailed less than 30 days before expiration keeps coverage in force until 30 days after mailing, at the original rates (3937.26(B)).
• Renewal with a substantial premium increase: notice to the insured and agent at least 30 days before expiration (3937.27).
• Medical malpractice: cancellations (other than nonpayment) take effect at least 60 days after mailing, and nonrenewals and premium increases also need 60 days (3937.28).

Personal lines nonpayment cancellation

For homeowners, dwelling fire, tenant, inland marine and personal umbrella policies, a nonpayment cancellation takes effect at least 10 days after mailing (R.C. 3937.47).

Rates and forms

• Rates may not be excessive, inadequate or unfairly discriminatory, and may consider loss experience, catastrophe hazards and a reasonable profit margin (R.C. 3937.02).
• Insurers file every policy form, endorsement, rule, rate and rating plan (R.C. 3937.03). An insurer may file through a licensed rating organization but doesn't have to join one.
• Casualty filings generally take effect when filed, unless disapproved. A 30-day wait applies only if the Superintendent declares a commercial market noncompetitive (3937.03(C)).
• Property filings wait 30 days unless the Superintendent shortens the wait (R.C. 3935.04).

The claims rule (O.A.C. 3901-1-54)

• Acknowledge a claim within 15 days. Answer claimant communications within 15 days and Department inquiries within 21 days. Notice to an agent counts as notice to the insurer.
• Accept or deny within 21 days of proof of loss, or explain why more time is needed and update the claimant every 45 days. A denial must cite the specific policy provision.
• Pay within 10 days after acceptance once the amount is set.
• Unrepresented claimants get notice at least 60 days before a time limit runs out.
• Actual cash value is replacement cost at the time of loss, including sales tax, minus depreciation. Example: $20,000 replacement cost with $10,000 of depreciation is $10,000 ACV.
• Matching: when a replacement doesn't match, the insurer replaces enough of the item to give a reasonably comparable appearance.
• An insurer can't require a polygraph unless the policy allows it.
• An insurer can't call a payment final or a release unless the policy limit was paid or a compromise was agreed.
• Information about suspected fraud goes to the Department's fraud division within 60 days of receiving the proof of loss.

Fire losses

• Total loss by fire or lightning: absent fraud or an unconsented increase in risk, the insurer pays the whole amount stated in the policy. Cellar and foundation walls aren't part of the building when settling losses (R.C. 3929.25).
• Fire claims over $5,000: the insurer can't pay until the county treasurer's certificate on property taxes is furnished. It holds $2,000 for each $15,000 of the claim (or a contractor's estimate) to pay for removing, repairing or securing the structure, and returns it within 60 days after the work is proven complete (R.C. 3929.86).
• When an insured cancels a fire policy, the insurer may keep the short-rate earned premium (R.C. 3929.20).

Surplus lines

• A licensed property and casualty agent may place business through a licensed surplus lines broker (R.C. 3905.31). A resident surplus lines broker holds both property and casualty licenses and a $25,000 bond. Licenses expire on January 31 (R.C. 3905.30, 3905.35).
• Due diligence: contact at least five authorized insurers the agent represents that write the coverage (or all it represents, if fewer). No answer within 10 days counts as a declination. Exempt commercial purchasers may waive this in writing (R.C. 3905.33).
• The insured signs a statement that the insurer is nonadmitted and that OIGA doesn't cover it. Records are kept five years.
• The broker collects a 5% tax on gross premiums from the insured (R.C. 3905.36).

Market assistance

The Ohio Commercial Market Assistance Plan helps place commercial risks. It isn't an insurer. A licensed agent submits a written request with a fee and a statement that at least three insurers declined (R.C. 3930.02). A joint underwriting association can be activated for a class of business only by the Superintendent's rule (R.C. 3930.03).

Controlled insurers

A producer that controls an insurer must disclose that relationship in writing before the policy takes effect. When the business it places equals at least 5% of the insurer's admitted assets, a written contract is required, with premiums remitted at least monthly and no later than 90 days after the effective date (R.C. 3905.61 to 3905.64).

Guaranty association (R.C. Chapter 3955)

The Ohio Insurance Guaranty Association (OIGA) pays covered claims of insolvent insurers:

• up to $300,000 per claim (all claims from one person's injury or death count as one),
• up to $10,000 for unearned premium,
• nothing on claims of $100 or less, punitive damages, or policies of insureds with net worth over $50 million,
• for claims existing before insolvency or arising within 30 days after it.

Life, health, title, surety, ocean marine and workers' compensation aren't covered. Lawsuits are stayed six months after insolvency.

Common exam traps

• Commercial: 90-day line, then listed reasons only, with 30 days' notice (10 for nonpayment).
• Late nonrenewal notice extends coverage to 30 days after mailing.
• Claims rule: 15 / 21 / 10 days (acknowledge, decide, pay), with 45-day updates.
• ACV includes sales tax.
• Surplus lines: five insurers and a 10-day no-response rule; 5% tax.
• OIGA: $300,000, nothing for net worth over $50 million.