§ 26-13-118 — Favored agent or insurer

(a) No person shall require as a condition to loaning
money upon the security of any real or personal property, or to
the selling of that property under contract, that the owner of
the property to whom the money is to be loaned or the vendee of
the property being sold, shall place, continue or renew any
policy of insurance covering the property, or covering any
liability related to the property or the use thereof, through a
particular insurance agent or broker or in a particular insurer.
This does not prevent the lender or vendor, upon a reasonable
basis, from approving or disapproving of the insurer and
representative selected to underwrite the insurance, but the
basis for approval or disapproval shall relate only to:
(i) The adequacy and terms of the coverage with
respect to the interest of the vendor or lender to be insured
thereunder;
(ii) The financial standards to be met by the
insurer; and
(iii) The ability of the insurer or representative to
service the policy.