When can an insured cancel a Businessowners policy?

• A. At any time by mailing a written notice of cancellation
• B. Only at policy expiration
• C. Only with the insurer's consent
• D. Never

Answer: (A)

The insured can cancel a Businessowners policy at any time by sending written notice. When cancellation happens mid-term, the refund of unused premium is calculated on a short-rate basis, which accounts for the time the policy was in force and typically results in a smaller refund than a simple pro rata calculation. The cancellation takes effect on the date stated in the notice or when the insurer receives it, depending on the policy terms. The insurer does not need the insured’s consent to cancellation, and cancellation can occur before the policy expiration, not just at expiration. This flexibility is why canceling with written notice at any time is the correct concept.