New Mexico Administrative Code
Title 13 - INSURANCE
Chapter 18 - CREDIT INSURANCE
Part 2 - CREDIT LIFE AND CREDIT HEALTH INSURANCE
Section 13.18.2.12 - POLICY PROVISIONS
Current through Register Vol. 35, No. 6, March 26, 2024
A. The policy or certificate shall not contain provisions which would encourage misrepresentation or are unjust, unfair, inequitable, misleading, deceptive, or contrary to the law of this state.
B. Provisions in individual policies or group certificates pertaining to underwriting rules, conditions of eligibility or issue, or maximum amounts or terms of insurance may be used only to determine initial eligibility and may not, except as provided herein, be used as the basis for the termination or reduction of coverage or the denial of claims.
C. The policy may state that if coverage is issued in excess of a maximum amount or term limitation, the insurer has the right, within ninety days of effective date of coverage, to reduce the excess coverage and refund the charge for excess insurance, or terminate the coverage and refund the full charge for insurance, provided such adjustment is accomplished and the appropriate refund is made prior to the incurred date of any claim under such coverage.
D. The policy may state that if a debtor exceeds the eligibility age defined in Subsection B of 13.18.2.22 NMAC for credit life and Subsection D of 13.18.2.27 NMAC for credit accident and health, and has not incorrectly stated his or her age in writing, and the coverage is issued in error, the insurer has the right, within ninety days of the effective date of coverage, to terminate the coverage and refund the full charge for insurance, provided such termination is accomplished and the appropriate refund is made prior to the incurred dated of any claim under such coverage.
E. Coverage issued in connection with open-end transactions may contain provisions limiting the maximum amount of insurance which may become effective thereunder, and may contain provisions for automatic termination of coverage upon the attainment of a specified age of 72.
F. Nothing herein is intended to preclude an insurer, during the contestable period, from contesting coverage on the basis of a material misstatement by a debtor, subject to the requirement that the misstatement must be contained in a written statement signed by the debtor, and a copy of the statement must be furnished to the debtor or to his or her beneficiary.
