Current through Rules and Regulations filed through March 20, 2024
(1) On the face of each individual policy,
group policy, group certificate or notice of proposed insurance there shall be
placed a title which shall briefly and accurately describe the nature and form
of the policy.
(2) Every printed
portion of the policy, certificate, or notice of proposed insurance and any
endorsements thereto or applications therefor must be plainly printed in
light-faced type of a style in general use, the size of which shall be uniform
and not less than ten-point.
(3)
Each individual policy, group policy, and group certificate shall state that
the benefits payable thereunder shall only be paid to the creditor to reduce or
extinguish the debtor's then outstanding loan balance in the case of credit
life insurance coverage or the exact amount of the debtor's covered installment
payment due in the case of credit accident and sickness insurance and shall
further state that if the amount of insurance benefits payable exceeds the
insured's then outstanding insured loan balance in the case of credit life
insurance or the exact amount of the debtor's covered installment payment due
in the case of credit accident and sickness insurance by an amount of ten
dollars ($10.00) or more, such excess amount shall be payable either to the
debtor or to a beneficiary named by the debtor other than the creditor or to
the debtor's estate.
(a) Payment of any such
excess amount to the debtor or to any beneficiary named by the debtor other
than the creditor or to the debtor's estate shall be made payable by check or
draft of the insurer and shall be made payable only to such debtor or to such
other beneficiary named by the debtor or to such debtor's estate, provided that
at the option of the insurer, the delivery of such excess benefit check or
draft may be accomplished by the creditor acting as an authorized agent of the
insurer. For the purpose of this Rule, the term "excess amount" shall mean any
amount which is payable to the debtor or to the beneficiaries of the debtor
other than the creditor or to the debtor's estate under the credit insurance
policy which exceeds the amount necessary to extinguish the debtor's then
outstanding insured loan balance in the case of the credit life insurance, or
the exact amount of the debtor's covered installment payment due in the case of
credit accident and sickness insurance by an amount of ten dollars ($10.00) or
more.
(4)
(a) No credit insurance form used in this
State shall refer to an aggregate maximum amount of insurance for all
indebtedness, for all certificates or for all individual policies. However, a
company may establish an underwriting maximum amount of insurance per
indebtedness, per certificate or per individual policy and, if established, the
insurer must clearly set forth on each individual policy and each certificate
that the maximum amount of insurance applies to each indebtedness, each
certificate, or each individual policy.
(b) If an insurer fails to comply with the
provisions of O.C.G.A. Sections
33-27-1(2)(d),
33-27-1(3) and
33-30-1(4) by
insuring a debtor under a group policy in an amount in excess of the amount
authorized by law, or insures a debtor for an amount of credit life insurance
or credit accident or sickness insurance greater than the maximum amount set
forth in the group policy, and a claim occurs or commences, the full amount of
credit life insurance insured under each certificate shall be payable on the
death of the debtor, and the full amount of credit disability benefits insured
under each certificate shall be payable upon the disability of the debtor. If a
certificate has been issued in error to a debtor, under which the amount of
insurance exceeds the indebtedness, or the maximum amount set forth in the
group policy, or the maximum amount authorized by law, the insurer has the
right, before a claim occurs or commences, to correct the amount of insurance
not to exceed the maximum amount set forth in the group policy or the maximum
amount authorized by law. Where a lower premium results, a refund is
required.
(c) If an insurer insures
a debtor for an amount of credit life insurance or credit accident and sickness
insurance greater than the maximum amount set forth in an individual credit
insurance policy, and a claim occurs or commences, the full amount of credit
life insurance set forth in the individual policy shall be payable on the death
of the debtor, and the full amount of credit accident or sickness insurance
benefits insured under the individual policy shall be payable upon the
disability of the debtor. If an individual credit insurance policy has been
issued in error to a debtor, under which the amount of insurance exceeds the
indebtedness, or the maximum amount set forth in the individual credit
insurance policy, the insurer has the right, before a claim occurs or
commences, to correct the amount of insurance not to exceed the maximum amount
set forth in the individual policy. Where a lower premium results, a refund is
required.
(5) In any
refinancing of an insured indebtedness, the effective date of the coverage as
it affects any policy provision shall be deemed to be the first date on which
the debtor became insured under the initially purchased policy or certificate
covering the refinanced indebtedness, at least to the extent of the amount and
term of the indebtedness outstanding at the time of refinancing.
(6) Every individual credit insurance policy
and certificate of insurance shall contain a schedule of benefits
section.
(7) Where insurance is
written to cover any of the following transactions, the types of insurance,
terms and disclosure notices must conform to the following requirements:
(a) Balloon Transactions and Open-end Lease
Agreements. Net decreasing term insurance shall be the only authorized
coverage.
1. Where insurance is written to
cover balloon transactions and disability insurance is purchased, the balloon
payment must be indicated in the schedule and the following disclosure notice,
using the same or substantially equivalent language, must appear in bold print
on the face of the individual policy or the certificate of insurance:
NOTICE: If you are eligible for total disability benefits on
the disability insurance expiration date, your balloon payment shown in the
schedule will only be insured up to an amount equal to the monthly total
disability benefit.
2. The
disclosure notice for open-end lease agreements providing for disability
coverage, must contain the following notice using the same or substantially
equivalent language:
NOTICE: If you are eligible for total disability benefits on
the disability insurance expiration date, the end of the term residual value
shown in the schedule will only be insured up to an amount equal to the monthly
disability benefit.
This notice must appear in bold print on the face of the
individual policy or the certificate of insurance, with the end of the term
residual value shown in the schedule. The debtor must have a binding
contractual obligation to purchase the item(s) leased at the end of the lease
term. Proof of a binding contractual obligation must be submitted with the
credit insurance forms.
(b) Truncated Term. Net decreasing term
insurance shall be the only authorized coverage. The schedule must show the
maturity date of the loan and the following notice, using the same or
substantially equivalent language, must appear in bold print on the face of the
individual policy or certificate of insurance:
NOTICE: The life insurance benefit might not completely pay
off your loan. If the term of your loan exceeds the terms of insurance, the
death benefit is only payable if death occurs during the term of the insurance.
Total disability benefits will not be paid for any period of total disability
continuing after the termination date shown in the schedule.
(c) Revolving or Open-end Credit
Transactions. The following notice, using the same or substantially equivalent
language, must appear in bold print on the face of an individual policy or
certificate of insurance to address the effective date and termination date of
coverage:
NOTICE: Coverage will be effective from the time the account
has a balance and will continue, subject to policy provisions, as long as there
is an open balance. Coverage will cease when the account does not reflect an
open balance and will automatically be reinstated when there is an open
balance, subject to the termination provisions herein.
(d) Critical Period Disability. The following
notice, using the same or substantially equivalent language, must appear in
bold print on the face of the individual policy or certificate of insurance:
IMPORTANT NOTICE TO DEBTOR: If the term of your loan exceeds
thirty-six (36) months, the credit disability coverage provided by this policy
is limited. This coverage provides for an aggregate disability benefit which is
limited to thirty-six (36) times your monthly disability
benefit.
O.C.G.A. Secs.
33-2-9,
33-27-1,
33-30-1,
33-31-7,
33-31-8,
33-31-12.
