§ 38.2-3720 — Amount of credit life insurance and credit accident and sickness insurance

Virginia § 38.2-3720

• Jurisdiction: Virginia
• Title 38.2: INSURANCE
• Ch. 37.1: CREDIT LIFE INSURANCE AND CREDIT ACCIDENT AND SICKNESS INSURANCE

Text

A. Credit life insurance. 1. Where an indebtedness is repayable in substantially equal installments, the amount of credit life insurance shall at no time exceed the actual amount of unpaid indebtedness.

2. Notwithstanding the provisions of subdivision A 1, insurance on agricultural credit transaction commitments not exceeding one year in duration may be written up to the amount of the loan commitment, on a nondecreasing or level-term plan.

3. Notwithstanding the provisions of subdivision A 1 of this subsection, or any other subsection, insurance on educational credit transaction commitments may be written for the amount of the loan commitment.

B. Credit accident and sickness insurance. -- The total amount of periodic indemnity payable by credit accident and sickness insurance in the event of disability, as defined in the policy, shall not exceed the aggregate of the periodic scheduled unpaid installments of the indebtedness; and the amount of each periodic indemnity payment shall not exceed the original indebtedness divided by the number of periodic installments.

C. Maximum aggregate provisions. -- A provision in a credit life insurance or credit accident and sickness insurance policy or certificate issued thereunder that sets a maximum limit on total benefits payable thereunder shall apply only to that specific indebtedness for which such policy or certificate was issued.

D. The amount of credit life insurance on an indebtedness of any debtor shall not exceed $70,000 with any one insurance company.

Legislative History

1960, c. 67, § 38.1-482.4; 1972, c. 527, §§ 38.2-3703, 38.2-3704; 1982, c. 223; 1986, c. 562; 1992, c. 586.