(a) A policy loses certification if—

1. (1) The insuring organization withdraws the policy from the voluntary certification program; or

2. (2) CMS determines that—

   1. (i) The policy fails to meet the requirements specified in § 403.232(a); or
   2. (ii) The insuring organization has failed to meet the requirements for submittal of material specified in § 403.239.

(c) If a policy that displays the emblem, or that has been marketed as a certified policy without the emblem, loses certification, the insuring organization must notify each holder of the policy, or of a certificate issued under the policy, of that fact. The notice must be in writing and sent by the earlier of—

1. (1) The date of the first regular premium notice after the date the policy loses its certification; or
2. (2) 60 days after the date the policy loses its certification.