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A BILL TO BE ENTITLED
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AN ACT
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relating to certain refund requirements regarding credit |
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insurance. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 1153.202, Insurance Code, is amended by |
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amending Subsection (a) and adding Subsection (a-1) to read as |
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follows: |
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(a) Each individual policy or group policy and group |
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certificate must include a written notice stating [shall provide] |
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that: |
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(1) if the underlying debt or the insurance terminates |
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before the originally scheduled expiration [maturity] date of the |
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insurance [debt], including the termination of a debt by renewing |
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or refinancing the debt, the debtor may be entitled to a refund of |
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unearned premium; and |
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(2) the obligation of the insurer to refund any |
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unearned premium requires a notice: |
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(A) to be sent to the insurer, by the person who |
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is the holder of the underlying debt instrument as of the date on |
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which the debt terminates, within 90 days after the original |
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expiration date of the insurance; and |
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(B) that includes the name of the insured and the |
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policy number. |
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(a-1) The refund of any amount of unearned premium paid by |
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or charged to the debtor for insurance shall be paid or credited |
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promptly to the person entitled to the refund on receipt of the |
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notice required to be sent to the insurer under Subsection (a)(2). |
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SECTION 2. This Act applies only to a credit life or credit |
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accident and health insurance policy evidenced by an individual |
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policy or group certificate of insurance that is delivered, issued |
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for delivery, or renewed on or after January 1, 2008. A policy or |
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certificate delivered, issued for delivery, or renewed before |
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January 1, 2008, is governed by the law as it existed immediately |
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before the effective date of this Act, and that law is continued in |
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effect for that purpose. |
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SECTION 3. This Act takes effect September 1, 2007. |