IC 24-4.5-4-101 Short title
Sec. 101. Short Title _ This Chapter shall be known and may be
cited as Uniform Consumer Credit Code - Insurance. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-102 Application; relation to credit insurance act
Sec. 102. (1) Except as provided in subsection (2), this chapter
applies to insurance provided or to be provided in relation to a
consumer credit sale (IC 24-4.5-1-301.5(8)), a consumer lease (IC
24-4.5-2-106), or a consumer loan (IC 24-4.5-1-301.5(9)).
(2) The provision on cancellation by a creditor (IC 24-4.5-4-304)
applies to loans the primary purpose of which is the financing of
insurance. No other provision of this chapter applies to insurance so
financed.
(3) This chapter supplements and does not repeal IC 27-8-4 (the
credit insurance act). The provisions of this article concerning
administrative controls, liabilities, and penalties do not apply to
persons acting as insurers, and the similar provisions of IC 27-8-4 do
not apply to creditors and debtors. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.153-1986, SEC.1; P.L.35-2010, SEC.61.
IC 24-4.5-4-103 "Consumer credit insurance" defined
Sec. 103. In this article, "consumer credit insurance" means
insurance, other than insurance on property, by which the satisfaction
of debt in whole or in part is a benefit provided, but does not include:
(1) insurance issued as an isolated transaction on the part of the
insurer not related to an agreement or plan for insuring debtors
of the creditor; or
(2) insurance indemnifying the creditor against loss due to the
debtor's default. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.153-1986, SEC.2.
IC 24-4.5-4-104 Creditor's provisions of and charge for insurance; excess amount
of charge
Sec. 104. Creditor's Provisions of and Charge for Insurance;
Excess Amount of Charge - (1) Except as otherwise provided in this
Chapter and subject to the provisions on additional charges (IC
24-4.5-2-202 and IC 24-4.5-3-202) and maximum charges (Part 2 of
Chapter 2 and Chapter 3), a creditor may agree to provide insurance,
and may contract for and receive a charge for insurance separate
from and in addition to other charges. A creditor need not make a
separate charge for insurance provided or required by him. This
Article does not authorize the issuance of any insurance prohibited
under any statute, or rule thereunder, governing the business of
insurance.
(2) The excess amount of a charge for insurance provided for in
agreements in violation of this Chapter is an excess charge for the
purposes of the provisions of the Chapter on remedies and penalties
(Chapter 5) as to effect of violations on rights of parties (IC
24-4.5-5-202) and of the provisions of the Chapter on administration
(Chapter 6) as to civil actions by the department (IC 24-4.5-6-113). (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by P.L.14-1992,
SEC.41.
IC 24-4.5-4-105 Conditions applying to insurance to be provided by creditor
Sec. 105. Conditions Applying to Insurance to be Provided by
Creditor _ If a creditor agrees with a debtor to provide insurance
(1) the insurance shall be evidenced by an individual policy or
certificate of insurance delivered to the debtor, or sent to him at his
address as stated by him, within thirty (30) days after the term of the
insurance commences under the agreement between the creditor and
debtor; or
(2) the creditor shall promptly notify the debtor of any failure or
delay in providing the insurance. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-106 Unconscionability
Sec. 106. Unconscionability _ (1) In applying the provisions of
the Article on unconscionability (24-4.5-5-108 and 24-4.5-6-111) to
a separate charge for insurance, consideration shall be given, among
other factors, to
(a) potential benefits to the debtor including the satisfaction of his
obligations;
(b) the creditor's need for the protection provided by the
insurance; and
(c) the relation between the amount and terms of credit granted
and the insurance benefits provided.
(2) If consumer credit insurance otherwise complies with this
Chapter and other applicable law, neither the amount nor the term of
the insurance nor the amount of a charge therefor is in itself
unconscionable. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-107 Maximum charge by creditor for insurance; methods for
calculating charge
Sec. 107. Maximum Charge by Creditor for Insurance - (1) Except
as provided in subsection (2), if a creditor contracts for or receives
a separate charge for insurance, the amount charged to the debtor for
the insurance may not exceed the premium to be charged by the
insurer, as computed at the time the charge to the debtor is
determined, conforming to any rate filings required by law and made
by the insurer with the Insurance Commissioner.
(2) A creditor who provides consumer credit insurance in relation
to a revolving charge account (IC 24-4.5-2-108) or revolving loan
account (IC 24-4.5-3-108) may calculate the charge to the debtor in
each billing cycle by applying the current premium rate to:
(a) the average daily unpaid balance of the debt in the cycle;
(b) the unpaid balance of the debt or a median amount within a
specified range of unpaid balances of debt on approximately the
same day of the cycle. The day of the cycle need not be the day used
in calculating the credit service charge (IC 24-4.5-2-207) or loan
finance charge (IC 24-4.5-3-201 and IC 24-4.5-3-508), but the
specified range shall be the range used for that purpose;
(c) the unpaid balances of principal calculated according to the
actuarial method; or
(d) the amount of the insurance benefit for the cycle. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.141-2005, SEC.2.
IC 24-4.5-4-108 Prepayment by proceeds of consumer credit insurance; refund
required; documentation; amount; interest; civil penalty
Sec. 108. Refund or Credit Required; Amount _ (1) Upon
prepayment in full of a consumer credit sale or consumer loan by the
proceeds of consumer credit insurance, the debtor or the debtor's
estate is entitled to a refund of:
(a) any portion of a separate charge for insurance which by
reason of prepayment is retained by the creditor or returned to
the creditor by the insurer unless the charge was computed from
time to time on the basis of the balances of the debtor's account;
and
(b) any portion of an additional charge that is:
(i) assessed in accordance with IC 24-4.5-2-202(1)(c) or
IC 24-4.5-3-202(1)(e); and
(ii) subject to rebate upon prepayment.
(2) This chapter does not require a creditor to grant a refund or
credit to the debtor if all refunds and credits due to the debtor under
this chapter amount to less than one dollar ($1), and except as
provided in subsection (1) does not require the creditor to account to
the debtor for any portion of a separate charge for insurance because:
(a) the insurance is terminated by performance of the insurer's
obligation;
(b) the creditor pays or accounts for premiums to the insurer in
amounts and at times determined by the agreement between
them; or
(c) the creditor receives directly or indirectly under any policy
of insurance a gain or advantage not prohibited by law.
(3) Except as provided in subsection (2), the creditor or the
creditor's assignee shall promptly make an appropriate refund or
credit to the debtor for any separate charge made for insurance or for
an additional charge described in subsection (1)(b) if:
(a) the insurance is not provided or is provided for a term
shorter than the term for which the charge to the debtor for
insurance was computed; or
(b) the insurance or the protection provided in exchange for the
additional charge described in subsection (1)(b) terminates prior
to the end of the scheduled term of the coverage because of
prepayment in full or otherwise.
(4) An initial creditor, a subsequent creditor, or an assignee of an
initial or a subsequent creditor, shall maintain documentation of any
account that is subject to a refund or credit under this section. The
information maintained under this subsection shall be made available
to the department as necessary to determine compliance with this
section.
(5) A refund or credit required by subsection (3) is appropriate as
to amount if it is computed according to a method prescribed or
approved by the insurance commissioner or a formula filed by the
insurer with the insurance commissioner at least thirty (30) days
before the debtor's right to a refund or credit becomes determinable,
unless the method or formula is used after the insurance
commissioner notifies the insurer that it is disapproved.
(6) If a refund or credit required by subsection (1) or (3) is not
made to the debtor within sixty (60) days after the date the debt is
terminated, due to prepayment in full or otherwise, the creditor shall
pay to the debtor for each day after the sixty (60) day period has
expired an amount equal to the daily interest at the contracted annual
percentage rate on the amount of the refund required by subsection
(1) due at the time of prepayment or termination. The director may
impose an additional civil penalty of not greater than one thousand
dollars ($1,000) per occurrence if a creditor engages in a pattern or
practice of failing to comply with this subsection. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.122-1994, SEC.29; P.L.172-1997, SEC.7; P.L.213-2007,
SEC.13; P.L.217-2007, SEC.12; P.L.90-2008, SEC.12.
IC 24-4.5-4-109 Existing insurance; choice of insurer
Sec. 109. Existing Insurance; Choice of Insurer _ If a creditor
requires insurance, upon notice to the creditor the debtor shall have
the option of providing the required insurance through an existing
policy of insurance owned or controlled by the debtor, or through a
policy to be obtained and paid for by the debtor, but the creditor may
for reasonable cause decline the insurance provided by the debtor. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-110 Charge for insurance connection with a deferral, refinancing, or
consolidation; duplicate charges
Sec. 110. (1) A creditor may not contract for or receive a separate
charge for insurance in connection with a deferral (IC 24-4.5-2-204
or IC 24-4.5-3-204), a refinancing (IC 24-4.5-2-205 or
IC 24-4.5-3-205), or a consolidation (IC 24-4.5-2-206 or
IC 24-4.5-3-206), unless:
(a) the debtor agrees at or before the time of the deferral,
refinancing, or consolidation that the charge may be made;
(b) the debtor is or is to be provided with insurance for an
amount or a term, or insurance of a kind, in addition to that to
which he would have been entitled had there been no deferral,
refinancing, or consolidation;
(c) the debtor receives a refund or credit on account of any
unexpired term of existing insurance in the amount that would
be required if the insurance were terminated (IC 24-4.5-4-108);
and
(d) the charge does not exceed the amount permitted by this
chapter (IC 24-4.5-4-107).
(2) A creditor may not contract for or receive a separate charge
for insurance which duplicates insurance with respect to which the
creditor has previously contracted for or received a separate charge. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.152-1986, SEC.66.
IC 24-4.5-4-111 Cooperation between administrator and insurance commissioner
Sec. 111. Cooperation Between the Department and Insurance
Commissioner - The department and the Insurance Commissioner are
authorized and directed to consult and assist one another in
maintaining compliance with this Chapter. They may jointly pursue
investigations, prosecute suits, and take other official action, as may
seem to them appropriate, if either of them is otherwise empowered
to take the action. If the department is informed of a violation or
suspected violation by an insurer of this Chapter, or of the insurance
laws, rules, and regulations of this State, the department shall advise
the Insurance Commissioner of the circumstances. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by P.L.14-1992,
SEC.42.
IC 24-4.5-4-112 Administrative action of commissioner of insurance
Sec. 112. (1) To the extent that his responsibility under this
chapter requires, the commissioner of insurance shall issue rules with
respect to insurers, and with respect to refunds (IC 24-4.5-4-108),
forms, schedules of premium rates and charges (IC 24-4.5-4-203),
and his approval or disapproval thereof and, in case of violation, may
make an order for compliance.
(2) IC 4-21.5-3 applies to and governs all agency action taken by
the commissioner of insurance pursuant to this section.
(Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.152-1986, SEC.67; P.L.7-1987, SEC.107.
(Part 2. Consumer Credit Insurance)
IC 24-4.5-4-201 Term of insurance
Sec. 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 debtor becomes obligated to the creditor or when
the debtor applies for the insurance, whichever is later, except as
follows:
(a) if any required evidence of insurability is not furnished until
more than thirty (30) 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 charge account or
revolving loan account, the term need extend only until the payment
of the debt under the account and may be sooner terminated after at
least thirty (30) days' notice to the debtor; or
(b) if the debtor 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 fifteen
(15) days after the originally scheduled due date of the last scheduled
payment of the debt unless it is extended without additional cost to
the debtor or as an incident to a deferral; refinancing, or
consolidation. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-202 Amount of insurance
Sec. 202. (1) Except as provided in subsection (2):
(a) in the case of consumer credit insurance providing life
coverage, the amount of insurance may not initially exceed the
debt and, if the debt is payable in instalments, may not at any
time exceed the greater of the scheduled or actual amount of the
debt; or
(b) in the case of any other consumer credit insurance, the total
amount of periodic benefits payable may not exceed the total of
scheduled unpaid instalments of the debt, and the amount of any
periodic benefit may not exceed the original amount of debt
divided by the number of periodic instalments in which it is
payable.
(2) If consumer credit insurance is provided in connection with a
revolving charge account or revolving loan account, the amounts
payable as insurance benefits may be reasonably commensurate with
the amount of debt as it exists from time to time. If consumer credit
insurance is provided in connection with a commitment to grant
credit in the future, the amounts payable as insurance benefits may
be reasonably commensurate with the total from time to time of the
amount of debt and the amount of the commitment. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.247-1983, SEC.20.
IC 24-4.5-4-203 Filing and approval of rates and forms
Sec. 203. (1) A creditor may not use a form, or a schedule of
premium rates or charges, the filing of which is required by this
section, if the insurance commissioner has disapproved the form or
schedule and has notified the insurer of his disapproval. A creditor
may not use a form or schedule unless:
(a) the form or schedule has been on file with the insurance
commissioner for thirty (30) days, or has earlier been approved
by him; and
(b) the insurer has complied with this section with respect to the
insurance.
(2) Except as provided in subsection (3), all policies, certificates
of insurance, notices of proposed insurance, applications for
insurance, endorsements and riders relating to consumer credit
insurance delivered or issued for delivery in this state, and the
schedules of premium rates or charges pertaining thereto, shall be
filed by the insurer with the insurance commissioner. Within thirty
(30) days after the filing of any form or schedule, he shall disapprove
it if the premium rates or charges are unreasonable in relation to the
benefits provided under the form, or if the form contains provisions
which are unjust, unfair, inequitable, or deceptive, or encourage
misrepresentation of the coverage, or are contrary to any provision
of IC 27 or of any rule promulgated under IC 27.
(3) If a group policy has been delivered in another state, the forms
to be filed by the insurer with the insurance commissioner are the
group certificates and notices of proposed insurance. He shall
approve them if:
(a) they provide the information that would be required if the
group policy were delivered in this state; and
(b) the applicable premium rates or charges do not exceed those
established by his rules. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.152-1986, SEC.68.
(Part 3. Property and Liability Insurance) IC 24-4.5-4-301 Property insurance
Sec. 301. Property Insurance - (1) A creditor may not contract for
or receive a separate charge for insurance against loss of or damage
to property unless
(a) the insurance covers a substantial risk of loss of or damage to
property related to the credit transaction;
(b) the amount, terms, and conditions of the insurance are
reasonable in relation to the character and value of the property
insured or to be insured; and
(c) the term of the insurance is reasonable in relation to the terms
of credit.
(2) The term of the insurance is reasonable if it is customary and
does not extend substantially beyond a scheduled maturity.
(3) A creditor may not contract for or receive a separate charge
for insurance against loss of or damage to property unless the amount
financed or principal exclusive of charges for the insurance is three
hundred dollars ($300) or more, and the value of the property is three
hundred dollar ($300) or more.
(4) The amounts of three hundred dollars ($300) in subsection (3)
are subject to change pursuant to the provisions on adjustment of
dollar amounts (24-4.5-1-106). (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-302 Insurance on creditor's interest only
Sec. 302. Insurance on Creditor's Interest Only _ If a creditor
contracts for or receives a separate charge for insurance against loss
of or damage to property, the risk of loss or damage not willfully
caused by the debtor is on the debtor only to the extent of any
deficiency in the effective coverage of the insurance, even though the
insurance covers only the interest of the creditor. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-303 Liability insurance
Sec. 303. Liability Insurance _ A creditor may not contract for
or receive a separate charge for insurance against liability unless the
insurance covers a substantial risk of liability arising out of the
ownership or use of property related to the credit transaction. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-304 Cancellation by creditor
Sec. 304. Cancellation by Creditor _ A creditor shall not request
cancellation of a policy of property or liability insurance except after
the debtor's default or in accordance with a written authorization by
the debtor, and in either case the cancellation does not take effect
until written notice is delivered to the debtor or mailed to him at his
address as stated by him. The notice shall state that the policy may
be cancelled on a date not less than ten (10) days after the notice is
delivered, or, if the notice is mailed, not less than thirteen (13) days
after it is mailed. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-305 Refund of unearned premium for property insurance upon
payment of loan
Sec. 305. Upon the payment in full of a consumer credit sale or
consumer loan, the creditor or creditor's assignee shall promptly
make an appropriate refund of the unearned premium for any
property insurance with respect to which the creditor or the credit
account of the consumer is a beneficiary. As added by P.L.122-1994, SEC.30.
IC 24-4.5-4-101 Short title
Sec. 101. Short Title _ This Chapter shall be known and may be
cited as Uniform Consumer Credit Code - Insurance. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-102 Application; relation to credit insurance act
Sec. 102. (1) Except as provided in subsection (2), this chapter
applies to insurance provided or to be provided in relation to a
consumer credit sale (IC 24-4.5-1-301.5(8)), a consumer lease (IC
24-4.5-2-106), or a consumer loan (IC 24-4.5-1-301.5(9)).
(2) The provision on cancellation by a creditor (IC 24-4.5-4-304)
applies to loans the primary purpose of which is the financing of
insurance. No other provision of this chapter applies to insurance so
financed.
(3) This chapter supplements and does not repeal IC 27-8-4 (the
credit insurance act). The provisions of this article concerning
administrative controls, liabilities, and penalties do not apply to
persons acting as insurers, and the similar provisions of IC 27-8-4 do
not apply to creditors and debtors. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.153-1986, SEC.1; P.L.35-2010, SEC.61.
IC 24-4.5-4-103 "Consumer credit insurance" defined
Sec. 103. In this article, "consumer credit insurance" means
insurance, other than insurance on property, by which the satisfaction
of debt in whole or in part is a benefit provided, but does not include:
(1) insurance issued as an isolated transaction on the part of the
insurer not related to an agreement or plan for insuring debtors
of the creditor; or
(2) insurance indemnifying the creditor against loss due to the
debtor's default. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.153-1986, SEC.2.
IC 24-4.5-4-104 Creditor's provisions of and charge for insurance; excess amount
of charge
Sec. 104. Creditor's Provisions of and Charge for Insurance;
Excess Amount of Charge - (1) Except as otherwise provided in this
Chapter and subject to the provisions on additional charges (IC
24-4.5-2-202 and IC 24-4.5-3-202) and maximum charges (Part 2 of
Chapter 2 and Chapter 3), a creditor may agree to provide insurance,
and may contract for and receive a charge for insurance separate
from and in addition to other charges. A creditor need not make a
separate charge for insurance provided or required by him. This
Article does not authorize the issuance of any insurance prohibited
under any statute, or rule thereunder, governing the business of
insurance.
(2) The excess amount of a charge for insurance provided for in
agreements in violation of this Chapter is an excess charge for the
purposes of the provisions of the Chapter on remedies and penalties
(Chapter 5) as to effect of violations on rights of parties (IC
24-4.5-5-202) and of the provisions of the Chapter on administration
(Chapter 6) as to civil actions by the department (IC 24-4.5-6-113). (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by P.L.14-1992,
SEC.41.
IC 24-4.5-4-105 Conditions applying to insurance to be provided by creditor
Sec. 105. Conditions Applying to Insurance to be Provided by
Creditor _ If a creditor agrees with a debtor to provide insurance
(1) the insurance shall be evidenced by an individual policy or
certificate of insurance delivered to the debtor, or sent to him at his
address as stated by him, within thirty (30) days after the term of the
insurance commences under the agreement between the creditor and
debtor; or
(2) the creditor shall promptly notify the debtor of any failure or
delay in providing the insurance. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-106 Unconscionability
Sec. 106. Unconscionability _ (1) In applying the provisions of
the Article on unconscionability (24-4.5-5-108 and 24-4.5-6-111) to
a separate charge for insurance, consideration shall be given, among
other factors, to
(a) potential benefits to the debtor including the satisfaction of his
obligations;
(b) the creditor's need for the protection provided by the
insurance; and
(c) the relation between the amount and terms of credit granted
and the insurance benefits provided.
(2) If consumer credit insurance otherwise complies with this
Chapter and other applicable law, neither the amount nor the term of
the insurance nor the amount of a charge therefor is in itself
unconscionable. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-107 Maximum charge by creditor for insurance; methods for
calculating charge
Sec. 107. Maximum Charge by Creditor for Insurance - (1) Except
as provided in subsection (2), if a creditor contracts for or receives
a separate charge for insurance, the amount charged to the debtor for
the insurance may not exceed the premium to be charged by the
insurer, as computed at the time the charge to the debtor is
determined, conforming to any rate filings required by law and made
by the insurer with the Insurance Commissioner.
(2) A creditor who provides consumer credit insurance in relation
to a revolving charge account (IC 24-4.5-2-108) or revolving loan
account (IC 24-4.5-3-108) may calculate the charge to the debtor in
each billing cycle by applying the current premium rate to:
(a) the average daily unpaid balance of the debt in the cycle;
(b) the unpaid balance of the debt or a median amount within a
specified range of unpaid balances of debt on approximately the
same day of the cycle. The day of the cycle need not be the day used
in calculating the credit service charge (IC 24-4.5-2-207) or loan
finance charge (IC 24-4.5-3-201 and IC 24-4.5-3-508), but the
specified range shall be the range used for that purpose;
(c) the unpaid balances of principal calculated according to the
actuarial method; or
(d) the amount of the insurance benefit for the cycle. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.141-2005, SEC.2.
IC 24-4.5-4-108 Prepayment by proceeds of consumer credit insurance; refund
required; documentation; amount; interest; civil penalty
Sec. 108. Refund or Credit Required; Amount _ (1) Upon
prepayment in full of a consumer credit sale or consumer loan by the
proceeds of consumer credit insurance, the debtor or the debtor's
estate is entitled to a refund of:
(a) any portion of a separate charge for insurance which by
reason of prepayment is retained by the creditor or returned to
the creditor by the insurer unless the charge was computed from
time to time on the basis of the balances of the debtor's account;
and
(b) any portion of an additional charge that is:
(i) assessed in accordance with IC 24-4.5-2-202(1)(c) or
IC 24-4.5-3-202(1)(e); and
(ii) subject to rebate upon prepayment.
(2) This chapter does not require a creditor to grant a refund or
credit to the debtor if all refunds and credits due to the debtor under
this chapter amount to less than one dollar ($1), and except as
provided in subsection (1) does not require the creditor to account to
the debtor for any portion of a separate charge for insurance because:
(a) the insurance is terminated by performance of the insurer's
obligation;
(b) the creditor pays or accounts for premiums to the insurer in
amounts and at times determined by the agreement between
them; or
(c) the creditor receives directly or indirectly under any policy
of insurance a gain or advantage not prohibited by law.
(3) Except as provided in subsection (2), the creditor or the
creditor's assignee shall promptly make an appropriate refund or
credit to the debtor for any separate charge made for insurance or for
an additional charge described in subsection (1)(b) if:
(a) the insurance is not provided or is provided for a term
shorter than the term for which the charge to the debtor for
insurance was computed; or
(b) the insurance or the protection provided in exchange for the
additional charge described in subsection (1)(b) terminates prior
to the end of the scheduled term of the coverage because of
prepayment in full or otherwise.
(4) An initial creditor, a subsequent creditor, or an assignee of an
initial or a subsequent creditor, shall maintain documentation of any
account that is subject to a refund or credit under this section. The
information maintained under this subsection shall be made available
to the department as necessary to determine compliance with this
section.
(5) A refund or credit required by subsection (3) is appropriate as
to amount if it is computed according to a method prescribed or
approved by the insurance commissioner or a formula filed by the
insurer with the insurance commissioner at least thirty (30) days
before the debtor's right to a refund or credit becomes determinable,
unless the method or formula is used after the insurance
commissioner notifies the insurer that it is disapproved.
(6) If a refund or credit required by subsection (1) or (3) is not
made to the debtor within sixty (60) days after the date the debt is
terminated, due to prepayment in full or otherwise, the creditor shall
pay to the debtor for each day after the sixty (60) day period has
expired an amount equal to the daily interest at the contracted annual
percentage rate on the amount of the refund required by subsection
(1) due at the time of prepayment or termination. The director may
impose an additional civil penalty of not greater than one thousand
dollars ($1,000) per occurrence if a creditor engages in a pattern or
practice of failing to comply with this subsection. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.122-1994, SEC.29; P.L.172-1997, SEC.7; P.L.213-2007,
SEC.13; P.L.217-2007, SEC.12; P.L.90-2008, SEC.12.
IC 24-4.5-4-109 Existing insurance; choice of insurer
Sec. 109. Existing Insurance; Choice of Insurer _ If a creditor
requires insurance, upon notice to the creditor the debtor shall have
the option of providing the required insurance through an existing
policy of insurance owned or controlled by the debtor, or through a
policy to be obtained and paid for by the debtor, but the creditor may
for reasonable cause decline the insurance provided by the debtor. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-110 Charge for insurance connection with a deferral, refinancing, or
consolidation; duplicate charges
Sec. 110. (1) A creditor may not contract for or receive a separate
charge for insurance in connection with a deferral (IC 24-4.5-2-204
or IC 24-4.5-3-204), a refinancing (IC 24-4.5-2-205 or
IC 24-4.5-3-205), or a consolidation (IC 24-4.5-2-206 or
IC 24-4.5-3-206), unless:
(a) the debtor agrees at or before the time of the deferral,
refinancing, or consolidation that the charge may be made;
(b) the debtor is or is to be provided with insurance for an
amount or a term, or insurance of a kind, in addition to that to
which he would have been entitled had there been no deferral,
refinancing, or consolidation;
(c) the debtor receives a refund or credit on account of any
unexpired term of existing insurance in the amount that would
be required if the insurance were terminated (IC 24-4.5-4-108);
and
(d) the charge does not exceed the amount permitted by this
chapter (IC 24-4.5-4-107).
(2) A creditor may not contract for or receive a separate charge
for insurance which duplicates insurance with respect to which the
creditor has previously contracted for or received a separate charge. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.152-1986, SEC.66.
IC 24-4.5-4-111 Cooperation between administrator and insurance commissioner
Sec. 111. Cooperation Between the Department and Insurance
Commissioner - The department and the Insurance Commissioner are
authorized and directed to consult and assist one another in
maintaining compliance with this Chapter. They may jointly pursue
investigations, prosecute suits, and take other official action, as may
seem to them appropriate, if either of them is otherwise empowered
to take the action. If the department is informed of a violation or
suspected violation by an insurer of this Chapter, or of the insurance
laws, rules, and regulations of this State, the department shall advise
the Insurance Commissioner of the circumstances. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by P.L.14-1992,
SEC.42.
IC 24-4.5-4-112 Administrative action of commissioner of insurance
Sec. 112. (1) To the extent that his responsibility under this
chapter requires, the commissioner of insurance shall issue rules with
respect to insurers, and with respect to refunds (IC 24-4.5-4-108),
forms, schedules of premium rates and charges (IC 24-4.5-4-203),
and his approval or disapproval thereof and, in case of violation, may
make an order for compliance.
(2) IC 4-21.5-3 applies to and governs all agency action taken by
the commissioner of insurance pursuant to this section.
(Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.152-1986, SEC.67; P.L.7-1987, SEC.107.
(Part 2. Consumer Credit Insurance)
IC 24-4.5-4-201 Term of insurance
Sec. 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 debtor becomes obligated to the creditor or when
the debtor applies for the insurance, whichever is later, except as
follows:
(a) if any required evidence of insurability is not furnished until
more than thirty (30) 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 charge account or
revolving loan account, the term need extend only until the payment
of the debt under the account and may be sooner terminated after at
least thirty (30) days' notice to the debtor; or
(b) if the debtor 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 fifteen
(15) days after the originally scheduled due date of the last scheduled
payment of the debt unless it is extended without additional cost to
the debtor or as an incident to a deferral; refinancing, or
consolidation. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-202 Amount of insurance
Sec. 202. (1) Except as provided in subsection (2):
(a) in the case of consumer credit insurance providing life
coverage, the amount of insurance may not initially exceed the
debt and, if the debt is payable in instalments, may not at any
time exceed the greater of the scheduled or actual amount of the
debt; or
(b) in the case of any other consumer credit insurance, the total
amount of periodic benefits payable may not exceed the total of
scheduled unpaid instalments of the debt, and the amount of any
periodic benefit may not exceed the original amount of debt
divided by the number of periodic instalments in which it is
payable.
(2) If consumer credit insurance is provided in connection with a
revolving charge account or revolving loan account, the amounts
payable as insurance benefits may be reasonably commensurate with
the amount of debt as it exists from time to time. If consumer credit
insurance is provided in connection with a commitment to grant
credit in the future, the amounts payable as insurance benefits may
be reasonably commensurate with the total from time to time of the
amount of debt and the amount of the commitment. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.247-1983, SEC.20.
IC 24-4.5-4-203 Filing and approval of rates and forms
Sec. 203. (1) A creditor may not use a form, or a schedule of
premium rates or charges, the filing of which is required by this
section, if the insurance commissioner has disapproved the form or
schedule and has notified the insurer of his disapproval. A creditor
may not use a form or schedule unless:
(a) the form or schedule has been on file with the insurance
commissioner for thirty (30) days, or has earlier been approved
by him; and
(b) the insurer has complied with this section with respect to the
insurance.
(2) Except as provided in subsection (3), all policies, certificates
of insurance, notices of proposed insurance, applications for
insurance, endorsements and riders relating to consumer credit
insurance delivered or issued for delivery in this state, and the
schedules of premium rates or charges pertaining thereto, shall be
filed by the insurer with the insurance commissioner. Within thirty
(30) days after the filing of any form or schedule, he shall disapprove
it if the premium rates or charges are unreasonable in relation to the
benefits provided under the form, or if the form contains provisions
which are unjust, unfair, inequitable, or deceptive, or encourage
misrepresentation of the coverage, or are contrary to any provision
of IC 27 or of any rule promulgated under IC 27.
(3) If a group policy has been delivered in another state, the forms
to be filed by the insurer with the insurance commissioner are the
group certificates and notices of proposed insurance. He shall
approve them if:
(a) they provide the information that would be required if the
group policy were delivered in this state; and
(b) the applicable premium rates or charges do not exceed those
established by his rules. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.152-1986, SEC.68.
(Part 3. Property and Liability Insurance) IC 24-4.5-4-301 Property insurance
Sec. 301. Property Insurance - (1) A creditor may not contract for
or receive a separate charge for insurance against loss of or damage
to property unless
(a) the insurance covers a substantial risk of loss of or damage to
property related to the credit transaction;
(b) the amount, terms, and conditions of the insurance are
reasonable in relation to the character and value of the property
insured or to be insured; and
(c) the term of the insurance is reasonable in relation to the terms
of credit.
(2) The term of the insurance is reasonable if it is customary and
does not extend substantially beyond a scheduled maturity.
(3) A creditor may not contract for or receive a separate charge
for insurance against loss of or damage to property unless the amount
financed or principal exclusive of charges for the insurance is three
hundred dollars ($300) or more, and the value of the property is three
hundred dollar ($300) or more.
(4) The amounts of three hundred dollars ($300) in subsection (3)
are subject to change pursuant to the provisions on adjustment of
dollar amounts (24-4.5-1-106). (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-302 Insurance on creditor's interest only
Sec. 302. Insurance on Creditor's Interest Only _ If a creditor
contracts for or receives a separate charge for insurance against loss
of or damage to property, the risk of loss or damage not willfully
caused by the debtor is on the debtor only to the extent of any
deficiency in the effective coverage of the insurance, even though the
insurance covers only the interest of the creditor. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-303 Liability insurance
Sec. 303. Liability Insurance _ A creditor may not contract for
or receive a separate charge for insurance against liability unless the
insurance covers a substantial risk of liability arising out of the
ownership or use of property related to the credit transaction. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-304 Cancellation by creditor
Sec. 304. Cancellation by Creditor _ A creditor shall not request
cancellation of a policy of property or liability insurance except after
the debtor's default or in accordance with a written authorization by
the debtor, and in either case the cancellation does not take effect
until written notice is delivered to the debtor or mailed to him at his
address as stated by him. The notice shall state that the policy may
be cancelled on a date not less than ten (10) days after the notice is
delivered, or, if the notice is mailed, not less than thirteen (13) days
after it is mailed. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-305 Refund of unearned premium for property insurance upon
payment of loan
Sec. 305. Upon the payment in full of a consumer credit sale or
consumer loan, the creditor or creditor's assignee shall promptly
make an appropriate refund of the unearned premium for any
property insurance with respect to which the creditor or the credit
account of the consumer is a beneficiary. As added by P.L.122-1994, SEC.30.
IC 24-4.5-4-101 Short title
Sec. 101. Short Title _ This Chapter shall be known and may be
cited as Uniform Consumer Credit Code - Insurance. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-102 Application; relation to credit insurance act
Sec. 102. (1) Except as provided in subsection (2), this chapter
applies to insurance provided or to be provided in relation to a
consumer credit sale (IC 24-4.5-1-301.5(8)), a consumer lease (IC
24-4.5-2-106), or a consumer loan (IC 24-4.5-1-301.5(9)).
(2) The provision on cancellation by a creditor (IC 24-4.5-4-304)
applies to loans the primary purpose of which is the financing of
insurance. No other provision of this chapter applies to insurance so
financed.
(3) This chapter supplements and does not repeal IC 27-8-4 (the
credit insurance act). The provisions of this article concerning
administrative controls, liabilities, and penalties do not apply to
persons acting as insurers, and the similar provisions of IC 27-8-4 do
not apply to creditors and debtors. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.153-1986, SEC.1; P.L.35-2010, SEC.61.
IC 24-4.5-4-103 "Consumer credit insurance" defined
Sec. 103. In this article, "consumer credit insurance" means
insurance, other than insurance on property, by which the satisfaction
of debt in whole or in part is a benefit provided, but does not include:
(1) insurance issued as an isolated transaction on the part of the
insurer not related to an agreement or plan for insuring debtors
of the creditor; or
(2) insurance indemnifying the creditor against loss due to the
debtor's default. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.153-1986, SEC.2.
IC 24-4.5-4-104 Creditor's provisions of and charge for insurance; excess amount
of charge
Sec. 104. Creditor's Provisions of and Charge for Insurance;
Excess Amount of Charge - (1) Except as otherwise provided in this
Chapter and subject to the provisions on additional charges (IC
24-4.5-2-202 and IC 24-4.5-3-202) and maximum charges (Part 2 of
Chapter 2 and Chapter 3), a creditor may agree to provide insurance,
and may contract for and receive a charge for insurance separate
from and in addition to other charges. A creditor need not make a
separate charge for insurance provided or required by him. This
Article does not authorize the issuance of any insurance prohibited
under any statute, or rule thereunder, governing the business of
insurance.
(2) The excess amount of a charge for insurance provided for in
agreements in violation of this Chapter is an excess charge for the
purposes of the provisions of the Chapter on remedies and penalties
(Chapter 5) as to effect of violations on rights of parties (IC
24-4.5-5-202) and of the provisions of the Chapter on administration
(Chapter 6) as to civil actions by the department (IC 24-4.5-6-113). (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by P.L.14-1992,
SEC.41.
IC 24-4.5-4-105 Conditions applying to insurance to be provided by creditor
Sec. 105. Conditions Applying to Insurance to be Provided by
Creditor _ If a creditor agrees with a debtor to provide insurance
(1) the insurance shall be evidenced by an individual policy or
certificate of insurance delivered to the debtor, or sent to him at his
address as stated by him, within thirty (30) days after the term of the
insurance commences under the agreement between the creditor and
debtor; or
(2) the creditor shall promptly notify the debtor of any failure or
delay in providing the insurance. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-106 Unconscionability
Sec. 106. Unconscionability _ (1) In applying the provisions of
the Article on unconscionability (24-4.5-5-108 and 24-4.5-6-111) to
a separate charge for insurance, consideration shall be given, among
other factors, to
(a) potential benefits to the debtor including the satisfaction of his
obligations;
(b) the creditor's need for the protection provided by the
insurance; and
(c) the relation between the amount and terms of credit granted
and the insurance benefits provided.
(2) If consumer credit insurance otherwise complies with this
Chapter and other applicable law, neither the amount nor the term of
the insurance nor the amount of a charge therefor is in itself
unconscionable. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-107 Maximum charge by creditor for insurance; methods for
calculating charge
Sec. 107. Maximum Charge by Creditor for Insurance - (1) Except
as provided in subsection (2), if a creditor contracts for or receives
a separate charge for insurance, the amount charged to the debtor for
the insurance may not exceed the premium to be charged by the
insurer, as computed at the time the charge to the debtor is
determined, conforming to any rate filings required by law and made
by the insurer with the Insurance Commissioner.
(2) A creditor who provides consumer credit insurance in relation
to a revolving charge account (IC 24-4.5-2-108) or revolving loan
account (IC 24-4.5-3-108) may calculate the charge to the debtor in
each billing cycle by applying the current premium rate to:
(a) the average daily unpaid balance of the debt in the cycle;
(b) the unpaid balance of the debt or a median amount within a
specified range of unpaid balances of debt on approximately the
same day of the cycle. The day of the cycle need not be the day used
in calculating the credit service charge (IC 24-4.5-2-207) or loan
finance charge (IC 24-4.5-3-201 and IC 24-4.5-3-508), but the
specified range shall be the range used for that purpose;
(c) the unpaid balances of principal calculated according to the
actuarial method; or
(d) the amount of the insurance benefit for the cycle. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.141-2005, SEC.2.
IC 24-4.5-4-108 Prepayment by proceeds of consumer credit insurance; refund
required; documentation; amount; interest; civil penalty
Sec. 108. Refund or Credit Required; Amount _ (1) Upon
prepayment in full of a consumer credit sale or consumer loan by the
proceeds of consumer credit insurance, the debtor or the debtor's
estate is entitled to a refund of:
(a) any portion of a separate charge for insurance which by
reason of prepayment is retained by the creditor or returned to
the creditor by the insurer unless the charge was computed from
time to time on the basis of the balances of the debtor's account;
and
(b) any portion of an additional charge that is:
(i) assessed in accordance with IC 24-4.5-2-202(1)(c) or
IC 24-4.5-3-202(1)(e); and
(ii) subject to rebate upon prepayment.
(2) This chapter does not require a creditor to grant a refund or
credit to the debtor if all refunds and credits due to the debtor under
this chapter amount to less than one dollar ($1), and except as
provided in subsection (1) does not require the creditor to account to
the debtor for any portion of a separate charge for insurance because:
(a) the insurance is terminated by performance of the insurer's
obligation;
(b) the creditor pays or accounts for premiums to the insurer in
amounts and at times determined by the agreement between
them; or
(c) the creditor receives directly or indirectly under any policy
of insurance a gain or advantage not prohibited by law.
(3) Except as provided in subsection (2), the creditor or the
creditor's assignee shall promptly make an appropriate refund or
credit to the debtor for any separate charge made for insurance or for
an additional charge described in subsection (1)(b) if:
(a) the insurance is not provided or is provided for a term
shorter than the term for which the charge to the debtor for
insurance was computed; or
(b) the insurance or the protection provided in exchange for the
additional charge described in subsection (1)(b) terminates prior
to the end of the scheduled term of the coverage because of
prepayment in full or otherwise.
(4) An initial creditor, a subsequent creditor, or an assignee of an
initial or a subsequent creditor, shall maintain documentation of any
account that is subject to a refund or credit under this section. The
information maintained under this subsection shall be made available
to the department as necessary to determine compliance with this
section.
(5) A refund or credit required by subsection (3) is appropriate as
to amount if it is computed according to a method prescribed or
approved by the insurance commissioner or a formula filed by the
insurer with the insurance commissioner at least thirty (30) days
before the debtor's right to a refund or credit becomes determinable,
unless the method or formula is used after the insurance
commissioner notifies the insurer that it is disapproved.
(6) If a refund or credit required by subsection (1) or (3) is not
made to the debtor within sixty (60) days after the date the debt is
terminated, due to prepayment in full or otherwise, the creditor shall
pay to the debtor for each day after the sixty (60) day period has
expired an amount equal to the daily interest at the contracted annual
percentage rate on the amount of the refund required by subsection
(1) due at the time of prepayment or termination. The director may
impose an additional civil penalty of not greater than one thousand
dollars ($1,000) per occurrence if a creditor engages in a pattern or
practice of failing to comply with this subsection. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.122-1994, SEC.29; P.L.172-1997, SEC.7; P.L.213-2007,
SEC.13; P.L.217-2007, SEC.12; P.L.90-2008, SEC.12.
IC 24-4.5-4-109 Existing insurance; choice of insurer
Sec. 109. Existing Insurance; Choice of Insurer _ If a creditor
requires insurance, upon notice to the creditor the debtor shall have
the option of providing the required insurance through an existing
policy of insurance owned or controlled by the debtor, or through a
policy to be obtained and paid for by the debtor, but the creditor may
for reasonable cause decline the insurance provided by the debtor. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-110 Charge for insurance connection with a deferral, refinancing, or
consolidation; duplicate charges
Sec. 110. (1) A creditor may not contract for or receive a separate
charge for insurance in connection with a deferral (IC 24-4.5-2-204
or IC 24-4.5-3-204), a refinancing (IC 24-4.5-2-205 or
IC 24-4.5-3-205), or a consolidation (IC 24-4.5-2-206 or
IC 24-4.5-3-206), unless:
(a) the debtor agrees at or before the time of the deferral,
refinancing, or consolidation that the charge may be made;
(b) the debtor is or is to be provided with insurance for an
amount or a term, or insurance of a kind, in addition to that to
which he would have been entitled had there been no deferral,
refinancing, or consolidation;
(c) the debtor receives a refund or credit on account of any
unexpired term of existing insurance in the amount that would
be required if the insurance were terminated (IC 24-4.5-4-108);
and
(d) the charge does not exceed the amount permitted by this
chapter (IC 24-4.5-4-107).
(2) A creditor may not contract for or receive a separate charge
for insurance which duplicates insurance with respect to which the
creditor has previously contracted for or received a separate charge. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.152-1986, SEC.66.
IC 24-4.5-4-111 Cooperation between administrator and insurance commissioner
Sec. 111. Cooperation Between the Department and Insurance
Commissioner - The department and the Insurance Commissioner are
authorized and directed to consult and assist one another in
maintaining compliance with this Chapter. They may jointly pursue
investigations, prosecute suits, and take other official action, as may
seem to them appropriate, if either of them is otherwise empowered
to take the action. If the department is informed of a violation or
suspected violation by an insurer of this Chapter, or of the insurance
laws, rules, and regulations of this State, the department shall advise
the Insurance Commissioner of the circumstances. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by P.L.14-1992,
SEC.42.
IC 24-4.5-4-112 Administrative action of commissioner of insurance
Sec. 112. (1) To the extent that his responsibility under this
chapter requires, the commissioner of insurance shall issue rules with
respect to insurers, and with respect to refunds (IC 24-4.5-4-108),
forms, schedules of premium rates and charges (IC 24-4.5-4-203),
and his approval or disapproval thereof and, in case of violation, may
make an order for compliance.
(2) IC 4-21.5-3 applies to and governs all agency action taken by
the commissioner of insurance pursuant to this section.
(Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.152-1986, SEC.67; P.L.7-1987, SEC.107.
(Part 2. Consumer Credit Insurance)
IC 24-4.5-4-201 Term of insurance
Sec. 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 debtor becomes obligated to the creditor or when
the debtor applies for the insurance, whichever is later, except as
follows:
(a) if any required evidence of insurability is not furnished until
more than thirty (30) 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 charge account or
revolving loan account, the term need extend only until the payment
of the debt under the account and may be sooner terminated after at
least thirty (30) days' notice to the debtor; or
(b) if the debtor 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 fifteen
(15) days after the originally scheduled due date of the last scheduled
payment of the debt unless it is extended without additional cost to
the debtor or as an incident to a deferral; refinancing, or
consolidation. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-202 Amount of insurance
Sec. 202. (1) Except as provided in subsection (2):
(a) in the case of consumer credit insurance providing life
coverage, the amount of insurance may not initially exceed the
debt and, if the debt is payable in instalments, may not at any
time exceed the greater of the scheduled or actual amount of the
debt; or
(b) in the case of any other consumer credit insurance, the total
amount of periodic benefits payable may not exceed the total of
scheduled unpaid instalments of the debt, and the amount of any
periodic benefit may not exceed the original amount of debt
divided by the number of periodic instalments in which it is
payable.
(2) If consumer credit insurance is provided in connection with a
revolving charge account or revolving loan account, the amounts
payable as insurance benefits may be reasonably commensurate with
the amount of debt as it exists from time to time. If consumer credit
insurance is provided in connection with a commitment to grant
credit in the future, the amounts payable as insurance benefits may
be reasonably commensurate with the total from time to time of the
amount of debt and the amount of the commitment. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.247-1983, SEC.20.
IC 24-4.5-4-203 Filing and approval of rates and forms
Sec. 203. (1) A creditor may not use a form, or a schedule of
premium rates or charges, the filing of which is required by this
section, if the insurance commissioner has disapproved the form or
schedule and has notified the insurer of his disapproval. A creditor
may not use a form or schedule unless:
(a) the form or schedule has been on file with the insurance
commissioner for thirty (30) days, or has earlier been approved
by him; and
(b) the insurer has complied with this section with respect to the
insurance.
(2) Except as provided in subsection (3), all policies, certificates
of insurance, notices of proposed insurance, applications for
insurance, endorsements and riders relating to consumer credit
insurance delivered or issued for delivery in this state, and the
schedules of premium rates or charges pertaining thereto, shall be
filed by the insurer with the insurance commissioner. Within thirty
(30) days after the filing of any form or schedule, he shall disapprove
it if the premium rates or charges are unreasonable in relation to the
benefits provided under the form, or if the form contains provisions
which are unjust, unfair, inequitable, or deceptive, or encourage
misrepresentation of the coverage, or are contrary to any provision
of IC 27 or of any rule promulgated under IC 27.
(3) If a group policy has been delivered in another state, the forms
to be filed by the insurer with the insurance commissioner are the
group certificates and notices of proposed insurance. He shall
approve them if:
(a) they provide the information that would be required if the
group policy were delivered in this state; and
(b) the applicable premium rates or charges do not exceed those
established by his rules. (Formerly: Acts 1971, P.L.366, SEC.5.) As amended by
P.L.152-1986, SEC.68.
(Part 3. Property and Liability Insurance) IC 24-4.5-4-301 Property insurance
Sec. 301. Property Insurance - (1) A creditor may not contract for
or receive a separate charge for insurance against loss of or damage
to property unless
(a) the insurance covers a substantial risk of loss of or damage to
property related to the credit transaction;
(b) the amount, terms, and conditions of the insurance are
reasonable in relation to the character and value of the property
insured or to be insured; and
(c) the term of the insurance is reasonable in relation to the terms
of credit.
(2) The term of the insurance is reasonable if it is customary and
does not extend substantially beyond a scheduled maturity.
(3) A creditor may not contract for or receive a separate charge
for insurance against loss of or damage to property unless the amount
financed or principal exclusive of charges for the insurance is three
hundred dollars ($300) or more, and the value of the property is three
hundred dollar ($300) or more.
(4) The amounts of three hundred dollars ($300) in subsection (3)
are subject to change pursuant to the provisions on adjustment of
dollar amounts (24-4.5-1-106). (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-302 Insurance on creditor's interest only
Sec. 302. Insurance on Creditor's Interest Only _ If a creditor
contracts for or receives a separate charge for insurance against loss
of or damage to property, the risk of loss or damage not willfully
caused by the debtor is on the debtor only to the extent of any
deficiency in the effective coverage of the insurance, even though the
insurance covers only the interest of the creditor. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-303 Liability insurance
Sec. 303. Liability Insurance _ A creditor may not contract for
or receive a separate charge for insurance against liability unless the
insurance covers a substantial risk of liability arising out of the
ownership or use of property related to the credit transaction. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-304 Cancellation by creditor
Sec. 304. Cancellation by Creditor _ A creditor shall not request
cancellation of a policy of property or liability insurance except after
the debtor's default or in accordance with a written authorization by
the debtor, and in either case the cancellation does not take effect
until written notice is delivered to the debtor or mailed to him at his
address as stated by him. The notice shall state that the policy may
be cancelled on a date not less than ten (10) days after the notice is
delivered, or, if the notice is mailed, not less than thirteen (13) days
after it is mailed. (Formerly: Acts 1971, P.L.366, SEC.5.)
IC 24-4.5-4-305 Refund of unearned premium for property insurance upon
payment of loan
Sec. 305. Upon the payment in full of a consumer credit sale or
consumer loan, the creditor or creditor's assignee shall promptly
make an appropriate refund of the unearned premium for any
property insurance with respect to which the creditor or the credit
account of the consumer is a beneficiary. As added by P.L.122-1994, SEC.30.
