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Bowman v. State Roofing Co.7/18/2005
ORDER
Appellants Travelers Insurance Company and AFCO Credit Corporation have petitioned this Court for rehearing in this matter. We deny the petitions but withdraw our former opinion and substitute the attached opinion.
James E. Moore J.
John H. Waller, Jr. J.
E. C. Burnett, III J.
Costa M. Pleicones J.
While I agree with the change made to the opinion and the denial of the petition for rehearing filed by AFCO Credit Corporation, I would grant the petition for rehearing filed by Travelers Insurance Company.
Jean H. Toal C.J.
Opinion
Heard February 2, 2005 - Filed June 6, 2005 - Refiled July 18, 2005
AFFIRMED AS MODIFIED
Claimants Bowman and Gainey commenced these workers' compensation claims alleging on-the-job injuries sustained on June 3 and September 15, 1998, while working for respondent State Roofing Company (Employer). Employer's workers' compensation insurance carrier, appellant Travelers Insurance Company (Carrier), denied coverage on both claims asserting Employer's policy had been cancelled effective before either claim arose. The two claims came before the single commissioner solely on the issue of coverage. The commissioner found the policy was not effectively cancelled and ordered Carrier to appear and defend the claims on behalf of Employer. The full Commission affirmed, as did the circuit court. We affirm as modified.
FACTS
Employer purchased a workers' compensation insurance policy from Carrier with coverage for one year from November 8, 1997. On November 20, Employer signed a finance agreement with appellant/respondent AFCO Credit Corporation (Finance Company) whereby Finance Company agreed to finance the annual premium of $4,616 for Employer's workers' compensation insurance. In exchange, Employer agreed to repay Finance Company in nine monthly installments. Under this agreement, Finance Company was authorized to cancel the insurance policy if Employer did not comply with the terms of the finance agreement. On December 16, Finance Company paid the entire annual premium to Carrier.
Employer missed its first installment payment to Finance Company which was due January 8, 1998. On January 20, Finance Company mailed Employer a Notice of Intent advising that if the payment and a late charge were not received within ten days, the policy would be cancelled. On February 5, Finance Company issued a Notice of Cancellation (NOC) requesting that Carrier cancel the policy effective February 13. A copy of the NOC was sent to Employer.
Finance Company did not receive Employer's January installment until February 13 when the February installment was already due. Finance Company advised Employer that its account was still delinquent. Employer continued sending payments late and its account was not current until June 1998. On June 24, Finance Company sent to Carrier a Request for Reinstatement. After the June payment, Employer made no more payments to Finance Company. On July 20, Finance Company sent a second Notice of Intent followed by an NOC on August 6 requesting cancellation effective August 14.
It is undisputed that Carrier never refunded any unearned premium to either Finance Company or Employer.
ISSUES
1. Does the capitulation agreement signed by Employer resolve the issue of coverage?
2. Does noncompliance with statutory requirements render the cancellation ineffective?
DISCUSSION
1. Capitulation agreement
Appellants (Carrier and Finance Company) contend the Workers' Compensation Commission ha
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