Cancellation during the policy term may occur if the insurer is placed in supervision, conservatorship, or receivership and the cancellation or nonrenewal is approved by whom?

• A. The insured
• B. The supervisor, conservator, or receiver
• C. The regulator's staff
• D. The insurer's board of directors

Answer: (B)

When an insurer is placed under supervision, conservatorship, or receivership, the authority to cancel or nonrenew during the policy term rests with the person appointed to oversee the company. The supervisor, conservator, or receiver has the legal power to approve such cancellations, ensuring policyholders are protected and that any mid-term changes are handled in an orderly, regulated way during financial distress. The insured cannot grant or block approval, regulator staff do not independently authorize cancellations, and the insurer’s board loses the normal decision-making authority once supervision or receivership is in place.