§ 27-30-5. Term of consumer credit insurance.
(a) Effective date of coverage.
(1) For consumer credit insurance made available to and elected by the debtor before or
contemporaneous with a credit transaction to which the insurance relates, the term
of insurance shall, subject to acceptance by the insurer, commence on the date when
the debtor becomes obligated to the creditor, except that, when evidence of individual
insurability is required and such evidence is furnished more than thirty (30) days
after the date when the debtor becomes obligated to the creditor, the term of the
credit insurance may commence on the date on which the insurance company determines
the evidence to be satisfactory.
(2) For insurance coverage made available to and elected by the debtor on a date subsequent
to the date of the consumer credit transaction to which the insurance relates, the
insurance shall, subject to acceptance by the insurer, commence on a date not earlier
than the date the election is made by the debtor nor later than thirty (30) days following
the date on which the insurance company accepts the risk for coverage, according to
an objective method such as one related to a particular date within the billing or
repayment cycle or a calendar month.
(3) Notwithstanding the provisions of subdivisions (a)(1) and (a)(2), when a group policy
provides coverage with respect to debts existing on the policy effective date, the
insurance relating to the debt shall not commence before the effective date of the
group policy.
(4) In no event shall a charge for insurance be made to the debtor and retained by the
creditor or insurer for any time prior to commencement of the consumer credit insurance
to which the charge is related.
(b) Termination date of coverage.
(1) The term of any consumer credit insurance shall not extend beyond the termination
date specified in the policy. The termination date of insurance may precede, coincide
with, or follow the scheduled maturity date of the debt to which it relates, subject
to any other requirements and restrictions of this chapter.
(2) The term of any consumer credit insurance shall not extend more than fifteen (15)
days beyond the scheduled maturity date of the debt except when extended without additional
cost to the debtor or except when extended pursuant to a written agreement, signed
by the debtor, in connection with a variable interest rate credit transaction or a
deferral, renewal, refinancing, or consolidation of debt.
(3) If the debt is discharged due to renewal, financing, or consolidation prior to the
scheduled termination date of insurance, any insurance in force shall be terminated
before any new insurance may be written in connection with the renewed, refinanced,
or consolidated debt.
(4) In all cases of termination of insurance prior to the scheduled termination of the
insurance, an appropriate refund or credit to the debtor shall be made of any unearned
insurance charge paid by the debtor for a term of insurance after the date of the
termination, except that no refund is required of a charge made for insurance if the
insurance is terminated by performance of the insurer's obligation with respect to
insurance.
(5) An insured debtor may terminate consumer credit insurance at any time by providing
advance request to the insurer. The individual policy or group certificate may require
that the request be in writing or that the debtor surrender the individual policy
or group certificate, or both. The debtor's right to terminate coverage may also be
subject to the terms of the credit transaction contract.