§ 27-5-6. Binders and temporary insurance.
Binders or other contracts for temporary insurance may be made, orally or in writing,
for a period that shall not exceed thirty (30) days, and shall be deemed to include
all of the terms of the standard fire insurance policy and all applicable endorsements,
approved by the director of business regulation, as may be designated in the contract
of temporary insurance; except that the cancellation clause of the standard fire insurance
policy, and the clause specifying the hour of the day at which the insurance shall
commence, may be superseded by the express terms of the contract of temporary insurance;
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§ 27-5-6. Binders and temporary insurance.
Binders or other contracts for temporary insurance may be made, orally or in writing,
for a period that shall not exceed thirty (30) days, and shall be deemed to include
all of the terms of the standard fire insurance policy and all applicable endorsements,
approved by the director of business regulation, as may be designated in the contract
of temporary insurance; except that the cancellation clause of the standard fire insurance
policy, and the clause specifying the hour of the day at which the insurance shall
commence, may be superseded by the express terms of the contract of temporary insurance;
provided, that all banks and lending institutions doing business in this state, whether
acting under state or federal authority, which include, but are not limited to: (1)
A bank, savings bank, or trust company, as defined in this title, its affiliates or
subsidiaries; (2) A bank holding company as defined in 12 U.S.C. § 1841, its affiliates or subsidiaries; (3) Mortgage companies; and (4) Any other individual,
corporation, partnership, or association authorized to take deposits and/or to make
loans of money under the provisions of title 19, shall be required to accept an insurance
binder as evidence of insurance from any duly licensed insurance producer or insurance
company; provided, that the binders are in writing and in a form acceptable to the
mortgagee and indicating that the mortgagee will be listed as a loss payee on the
binder or temporary contract and that the mortgagee will be notified by registered
or certified mail in the event the binder or temporary insurance is cancelled. If
a binder is utilized, a policy shall, at the request of the mortgagee, be produced
within thirty (30) days after the real estate closing has been consummated. Any subsequent
holder of the mortgage, as a result of the sale, transfer, conveyance, or assignment
of the mortgage, shall have its interest automatically protected and covered in accordance
with the notice requirements in § 27-5-3.2.