§ 5-4-201 — Term of insurance

(1) Consumer credit insurance provided by a
creditor may be subject to the furnishing of evidence of insurability satisfactory to
the insurer. Whether or not such evidence is required, the term of the insurance
shall commence no later than when the consumer becomes obligated to the
creditor or when the consumer applies for the insurance, whichever is later, except
as follows:

(a) If any required evidence of insurability is not furnished until more than
thirty days after the term would otherwise commence, the term may commence on
the date when the insurer determines the evidence to be satisfactory; or

(b) If the creditor provides insurance not previously provided covering debts
previously created, the term may commence on the effective date of the policy.

(2) The originally scheduled term of the insurance shall extend at least until
the due date of the last scheduled payment of the debt except as follows:

(a) If the insurance relates to a revolving credit account, the term need
extend only until the payment of the debt under the account and may be sooner
terminated after at least thirty days' notice to the consumer; or

(b) If the consumer is advised in writing that the insurance will be written for
a specified shorter time, the term need extend only until the end of the specified
time.

(3) The term of the insurance shall not extend more than thirty days after the
originally scheduled due date of the last scheduled payment of the debt unless it is
extended without additional cost to the consumer or as an incident to a deferral,
refinancing, or consolidation.

Legislative History

Source: L. 2000: Entire article R&RE, p. 1230, � 1, effective July 1.