Not taken renewals cancellation

There are three types of renewal flows:

  • Bind-and-cancel
  • Renewal offers
  • Confirmed renewals

For a line of business that uses the bind-and-cancel renewal flow, PolicyCenter binds a renewal policy period as part of the renewal offer process. If the user does not pay, the lack of payment in the billing system indicates that the policyholder does not want to take the renewal. Next, the billing system uses web services to initiate a flat cancel order in PolicyCenter. In this case, the cancellation reason is not taken rather than non-payment. The not taken delinquency process does not require dunning letters and threats to cancel. The handling of dunning letters differentiates the not taken reason from non-payment.

For a line of business that uses confirmed renewals, the billing system notifies PolicyCenter of the not-taken cancellation if the insured does not pay by the deadline. This causes PolicyCenter to stop referring to the policy term as pending confirmation, but instead as cancelled.

For confirmed renewals, the original renewal letter indicates that coverage is expiring but the company provides renewal coverage only if the company receives payment by a specified date. If the company does not receive the payment, BillingCenter sends PolicyCenter a message to cancel the policy with a not-taken cancellation reason. PolicyCenter flat cancels the policy as of the effective date of the policy period.

In all of these cases, neither PolicyCenter nor the billing system need to implement dunning letters and threats to cancel.

If you use BillingCenter, BillingCenter has its own workflow to manage the delinquency process for renewals. If the insured fails to pay within a specified time, BillingCenter begins a delinquency process for non-payment of a renewal.

The not-taken renewal process is as follows:

  1. The PolicyCenter automated renewal process initiates a renewal, creates a quote, and binds the policy period.
  2. PolicyCenter sends BillingCenter the new policy period and charges on the renewal billing instruction.
  3. The controlling Delinquency Plan includes the NotTaken delinquency reason in the workflow. The workflow type is CancelImmediately. The account delinquency plan initiates if the PolicyPeriod does not contain a delinquency plan. If both the account and the policy period have an assigned delinquency plan, the plan for the policy period prevails.
  4. BillingCenter bills the down payment as specified by the payment plan.
  5. If BillingCenter does not receive payment for the initial invoice of the policy period, BillingCenter starts a flat cancellation in PolicyCenter.

See also