Nebraska Administrative Code
Topic - INSURANCE, DEPARTMENT OF
Title 210 - NEBRASKA DEPARTMENT OF INSURANCE
Chapter 22 - CREDIT LIFE, ACCIDENT AND HEALTH INSURANCE
Section 210-22-005 - Refunds
Current through September 17, 2024
005.01 Each individual policy of credit life insurance and credit accident and health insurance on which the premium is paid by the debtor and each group certificate for which an identifiable charge is made to the debtor shall provide that, in the event of termination of the insurance prior to the scheduled maturity date of the indebtedness, any refund of premium or identifiable charge due shall be paid or credited promptly to the debtor. If a creditor requires a debtor to pay the premium or an identifiable charge for credit life insurance or credit accident and health insurance and such insurance is declined by the insurer or otherwise does not become effective, the insurer, creditor or licensed agent shall promptly arrange for a refund or credit to the debtor of any premium or identifiable charge paid by him for such insurance.
005.02 An insurer shall promptly refund to an individual policyholder and refund or credit to a group policyholder any refund of premium due on termination of insurance prior to the scheduled maturity date of the indebtedness, and a group policyholder or creditor shall promptly refund or credit to the debtor any refund due pursuant to this Section 005. Insurer shall be responsible for establishment of procedures by which such refunds or credits are made.
005.03 The following formulas for computing refunds of credit insurance premiums are hereby declared acceptable to the Director for the kinds of coverage specified.
005.04 At the option of the insurer but consistent with subsection 005.03: no charge for credit insurance may be made for the first fifteen (15) days of a loan month and a full month may be charged for sixteen (16) days or more of a loan month; or a refund may be made on a pro rata basis for each day within the loan month. If the appropriate refund formula is the "sum of the digits" formula, commonly known as the " rule of 78", it shall be sufficient to refer to it by either phrase. No insurance refund need be made to the consumer if all refunds and credits due him amount to less than one dollar ($1).
