Section 16-207. INSURANCE

 

207.1A licensee may require a borrower to pay the premium on insurance authorized by this section, but not otherwise.

 

207.2A copy of the policy of insurance on which the premium is required by the licensee to be paid by the borrower shall be delivered by the licensee to the borrower within twenty (20) days after the making of the loan.

 

207.3In no case shall life insurance be required in cases in which property is accepted as collateral security for a loan of money.

 

207.4No amount of money shall be charged or received by the licensee as premium on any policy of insurance unless the following is done:

 

(a)The evidence in writing of the loan of money describes each kind of insurance required by the licensee and states separately the term and premiums applicable to the insurance;

 

(b)An insurance policy or comparable evidence of a policy conforming to the term, description, and premiums set forth in the evidence of indebtedness has been furnished to the borrower prior to the date when any payment under that evidence of indebtedness is required to be made; and

 

(c)Prior to the date when the first payment under the evidence of indebtedness is required to be made, the licensee has furnished to the borrower an official receipt of the insurance company or its authorized representative, showing payment by the licensee to the insurance company on account or premium on the policy issued to the borrower of an amount not less than the amount of the premium set forth in said evidence of indebtedness.

 

207.5In the case of a policy of insurance issued on an automatic renewal basis for a term less than the term of the loan, the amount of premium which may be included in the evidence of indebtedness shall not exceed the premium on that policy for one policy period.

 

207.6If there is no collateral security for a loan of money, a reducing form of term life insurance on the life of the borrower in an amount not exceeding the actual amount of the loan for a term not exceeding the term of the loan may be required by the licensee.

 

207.7If a loan of money be made upon the collateral security of household furniture and furnishings, fire and extended coverage insurance for a term not exceeding the term of the loan in an amount not exceeding the fair market value of the collateral security property at the time policy is issued, payable to licensee and borrower as their interests may appear, may be required by the licensee.

 

207.8If a loan of money be made upon the collateral security of a vehicle, fifty dollars, seventy-five dollars, or one hundred dollars ($ 50, $ 75, or $ 100) deductible collision, as well as fire and theft insurance (or comprehensive in lieu of fire and theft) for a term that does not exceed the term of the loan payable to the licensee and the borrower as their interests may appear, may be required by the licensee.