§ 20-471 — Definition of insurance service charge; limit; prohibited use

Arizona § 20-471

• Jurisdiction: Arizona
• Title 20: Arizona Revised Statutes
• Ch. 2: TRANSACTION OF INSURANCE BUSINESS
• Art. 7: Insurance on Collateral Security

Text

A. "Insurance service charge" means any charge, other than the insurance premium, for the service of placing, renewing, approving or recording on the records and accounts of any mortgagee, vendor, holder or lender any substitution of insurers or change in insurance on the collateral security for a loan.

B. Except as provided in subsection C of this section, it shall be unlawful for any mortgagee, vendor, holder or lender to charge an insurance company, insurance agency, borrower, mortgagor or purchaser with payment of an insurance service charge.

C. An insurance service charge of eight dollars may be charged as a condition to acceptance of an insurance policy tendered to satisfy the requirements of a real estate mortgage contract when a mortgagee, vendor, holder or lender performs services in connection with this subsection, as follows:

1. An insurance policy is tendered without an authorization signed by the borrower appointing the insurance producer tendering the policy attached thereto, unless a prior authorization not revoked has been delivered to the lender.

2. An insurance policy is tendered without the borrower's mortgage loan number as assigned for payment identification or a legal description of the insured property printed in bold-faced type on the face of the policy.

3. An original, a renewal or a replacement insurance policy is tendered less than ten days prior to an expiration date, renewal date or continuous policy premium anniversary date, or expiration of an insurance binder issued preliminary to issuance of a permanent policy.

4. An insurance policy is tendered by an agent other than an agent appearing on the records of the mortgagee as authorized to represent the borrower at any time during the term of such insurance other than within thirty days prior to the policy's expiration date, renewal or continuous policy premium anniversary date.