Pacific Business Connections, Inc. v. St. Paul Surplus Lines Insurance

Following the denial of its insurance claim, appellant Pacific Business Connections, Inc. (PBC), brought this action against its insurer, respondent St. Paul Surplus Lines Insurance Company (St. Paul). St. Paul asserted that it was required to cancel the insurance policy pursuant to Insurance Code section 673 (section 673) once it received notice from Premium Financing Specialists of California, Inc. (Premium), the company that financed the insurance premiums, that PBC had defaulted on its loan obligation. The trial court agreed, and granted St. Paul summary judgment.

PBC appeals, contending that section 673 does not apply for a host of reasons.

We are not convinced by any of PBC’s arguments. Accordingly, we affirm.

FACTUAL AND PROCEDURAL BACKGROUND

Factual Background

In 2003, St. Paul issued an insurance policy to PBC to insure PBC’s fleet of trucks for its trucking business. Payment of the insurance premium was partially financed by Premium pursuant to a financing agreement executed by Premium and PBC in August 2003. Specifically, the total insurance premium due was $108,101.81. PBC agreed to make a down payment of $21,621 directly to St. Paul, leaving $86,480.81…