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Senate Bill 382 |
Senate Author: Carona |
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Effective: 9-1-07 |
House Sponsor: Taylor |
Under previous law, an individual policy or group certificate for credit life or credit accident and health insurance was required to provide for the prompt refund of any amount paid by or charged to the debtor for insurance if the underlying debt or the insurance terminated before the maturity date of the insurance. Senate Bill 382 amends the Insurance Code to require that such a policy or certificate issued or renewed on or after January 1, 2008, include a written notice stating that, if the debt terminates before the originally scheduled termination date of the insurance, the debtor is entitled to a refund of any unearned premium within 30 days after the insurer receives notice of the debt termination from the holder of the underlying debt instrument. The bill requires the holder to provide such notice within 60 days after the termination and requires the notice to include the name and address of the insured and the payoff date of the debt. The bill stipulates that if an insured asserts a claim or action against an insurer for failing to provide the refund in accordance with these provisions, the insurer is entitled to indemnity from a holder who failed to provide the required notice.