D. An extender of credit may offer credit life insurance in connection with a revolving loan account, lender credit card account, revolving charge account, or seller credit card account. The premium rate for individual credit life insurance offered in connection with such accounts shall not exceed .154 dollars per one hundred dollars, or portion thereof, per thirty day billing period that coverage is afforded. The premium rate for joint credit life insurance offered in connection with such accounts shall not exceed .231 dollars per one hundred dollars, or portion thereof, per thirty day billing period that the coverage is afforded. The charge for the revolving credit life insurance premium for each billing period shall not be due and payable until the end of the billing period that it insures. E. An extender of credit may offer any credit insurance authorized by the Louisiana Insurance Code in connection with a revolving loan account, lender credit card account, revolving charge account, or seller credit card account. The premium rate for these insurances shall not exceed the actuarial equivalent of the maximum rates allowed by law. Such rates shall have prior approval by the appropriate state agency. The charge for the revolving credit insurance premium for each billing period shall not be due and payable until the end of the billing period that it insures. F. In connection with a single consumer credit transaction, an extender of credit may not request or require a consumer to provide any credit insurance that provides duplicate or substantially the same protection against a single peril or loss as that furnished by any other credit insurance provided in connection with the same consumer credit transaction. G. Notwithstanding any other provision of law to the contrary, an extender of credit may offer any credit insurance authorized by the Louisiana Insurance Code in connection with any extension of credit authorized by this Chapter. §3543. Property insuranceA. An extender of credit may, in addition, request or require a consumer to insure property, all or part of which is involved in a contract or agreement, made under the authority of this Chapter, and include the cost of the insurance as a separate charge in the contract or agreement. The property shall be described so as to readily identify it and such description shall be included as part of the contract or agreement. This insurance and the premiums or charges thereon shall bear a reasonable relationship to the amount, term, and conditions of the contract or agreement, and to the existing hazards or risk of loss, damage, or destruction. This insurance and the premiums or charges thereon shall also bear a reasonable relationship to the character and value of the property insured or to be insured, when, in the event of loss, such insurance policy does not pay off the entire balance of the loan. Such insurance shall not provide for unusual or exceptional risks or coverages which are not ordinarily included in policies issued to the general public. B. Where a consumer fails to maintain required property insurance or fails to provide the creditor with timely notice of the purchase or renewal of such insurance coverage, the creditor may, after notice to the consumer and expiration of a fifteen day curative period from the mailing of said notice, purchase insurance on the customer's property, including insurance protecting only the creditor's interest in such property. Such insurance premiums may be added to the outstanding balance of the customer's indebtedness and made subject to additional loan finance charges or credit service charges at the rate previously agreed to by the consumer. §3544. Existing insuranceWhen consumer credit insurance is required in connection with such a contract or agreement made under this chapter, the extender of credit shall furnish the consumer a statement which shall clearly and conspicuously state that consumer credit insurance is required in connection with the contract, and that the consumer shall have the option of furnishing the required insurance either through existing policies of insurance coverages through any insurance company authorized to transact business in Louisiana. §3545. Limitations on insurance rates; contract requirementsAny insurance provided, sold, or obtained through an extender of credit shall be written at lawful rates and in accordance with the provisions of the Louisiana Insurance Code by a company authorized to do business in this state which is not under a court-ordered rehabilitation, conservation, liquidation, or dissolution; provided, however, that such insurance may be written in accordance with R.S. 22:1257 through 1270 if the provisions thereof are applicable. Any extender of credit which writes insurance in compliance with the preceding requirements shall not be liable to any insured as a result of the insurer's inability to pay any claim to an insured due to insolvency, or pursuant to any court-ordered rehabilitation, conservation, liquidation, or dissolution. The contract or agreement must briefly indicate the kind, coverage, term, and amount of premium of such insurance. §3546. Choice of insurerThe consumer shall have the privilege at the time of execution of the contract or agreement of purchasing any required or requested insurance from an agent or broker of his own selection and of selecting an insurance company acceptable to the extender of credit but, in such cases, the inclusion of the insurance premium in the contract or agreement shall be optional with the extender of credit. However, any licensed admitted property and casualty insurer possessing a valid certificate of authority to transact property and liability insurance coverage in the state of Louisiana shall be deemed to be an acceptable insurer for the provisions of this Chapter. The extender of credit may refuse any otherwise acceptable insurer which is under court-ordered rehabilitation, conservation, liquidation, or dissolution. §3547. Conditions applying to insurance provided by the extender of creditIf a creditor agrees with a debtor to obtain or provide insurance (1) the insurance shall be evidenced by an individual policy or certificate of insurance delivered to the debtor, or sent to him at his address as stated by him, within forty-five days after the term of the insurance commences; or (2) the creditor shall promptly notify the debtor of any failure or delay in providing or obtaining the insurance, individual policy or certificate of insurance. §3548. Cancellation of insurance; refund or credit upon cancellationA. When a consumer credit transaction is paid in full for any reason, the insurance paid by the debtor and provided, sold, or obtained through the extender of credit in connection therewith shall be cancelled; however, this provision shall not apply to credit life insurance and property insurance other than contents insurance which is the subject of a specific written request by the consumer requesting that such insurance remain in force beyond the provision of this Section. B. When insurance paid by the debtor is canceled, or terminated for any reason, the refund for unearned insurance premiums received by the extender of credit shall, at the extender's option, be applied toward payment of the premium for insurance to replace the coverage canceled, adjusted, or terminated, or toward payment of the unpaid balance of the consumer credit transaction. The order of applying said unearned premium shall be inverse to the order in which the installments of the consumer credit transaction are payable according to its terms, beginning with the installment due on the final due dates and not to the next ensuing installment which shall remain payable as originally scheduled. The remaining balance of unearned insurance premiums, if any, shall be refunded to the consumer; however, no cash refund shall be required if the amount thereof is less than one dollar, or to the extent provided for by federal law. §3549. Gain from insuranceAny gain, or advantage to the extender of credit, or any employee, officer, director, agent, general agent, affiliate or associate from such insurance or its provisions or sale shall not be considered as a further charge nor a further credit service charge or loan finance charge in violation of this chapter in connection with any contract or agreement made under this part. §3550. Insurance premium finance companiesA. This Section shall apply to any person engaged in the business of financing insurance premiums for consumers entering into premium finance agreements or otherwise acquiring premium finance agreements. B. For purposes of this Section: (1) "Insurance premium finance company" means a person engaged in the business of entering into premium finance agreements. (2) "License" means an insurance premium finance company holding a license issued under this Section. (3) "Person" includes an individual, limited liability company, partnership, association, business corporation, nonprofit corporation, common law trust, joint-stock company, or any other group of individuals however organized. (4) "Premium finance agreement" means an agreement by which an insured or prospective insured promises to pay to an insurance premium finance company the amount advanced or to be advanced under the agreement to an insurer or to an insurance agent or broker in payment of premiums on an insurance contract together with a service charge as authorized and limited by this Section. A premium finance agreement shall not include an agreement on the part of an extender of credit to finance credit life, credit disability, and credit property insurance coverage as an incident to a consumer credit transaction subject to this Chapter or subject to any other applicable provision of Louisiana or federal law. C.(1) No person, unless otherwise exempt from the licensing requirement of this Chapter, shall engage in the business of financing insurance premiums in this state or out of this state with Louisiana consumers, entering into premium finance agreements, or otherwise acquiring premium finance agreements subject to the Louisiana Consumer Credit Law, without first having obtained a license as an insurance premium finance company from the commissioner as provided in Subsection A of this Section. (2) The commissioner may in his discretion give prior written approval for an unlicensed person to acquire insurance premium finance agreements in connection with securitized financing arrangements. (3) The commissioner may issue insurance premium finance licenses for a temporary period, or subject to any restrictions or conditions he deems necessary. The application, license, examination, survey, renewal, and change of name or location fees shall be the same as those for a licensed lender as provided in R.S. 9:3561.1. D.(1) Premium finance agreements shall: (a) Be dated and signed by the insured or by its agent under a validly executed power of attorney. (b) Contain the name and place of business of the insurance agent who negotiated the related insurance contract, and a brief description of the insurance contract involved. (c) Include, either as part of the insurance premium finance agreement or refer to a separate document which shall be made a part of the insurance premium finance agreement by reference, an itemized listing of the premium cost, and each charge, fee, or other amount that is part of the total cost of obtaining the insurance coverage sought by the insured. (d) Contain the address of the insured and other persons who are entitled to receive all notices required under this Chapter. The address may be in the form of an electronic address or a physical address. (2) Upon accepting, funding, or declining a premium finance agreement of a related insurance contract primarily for personal, family, or household use, when the premiums were paid or were to be paid to the providing insurance agent, the premium finance company shall deliver or mail accountable written or electronic notification within five business days advising the insurer, managing general agent, or general agent of its actions to accept, fund, or decline the premium finance agreement. The notification shall state the insured's full name and address, the producing insurance agent's full name and address, the total policy cost, and the premiums that were paid to the producing insurance agent, or that the payment of premium was declined. E. An insurance premium finance company shall not charge, contract for, receive, or collect a loan finance charge or credit service charge, or any other fee or charge other than as provided in this Subsection or in Subsection F: (1) The loan finance charge or credit service charge shall be computed on the balance of the premium due, less the down payment made by the insured in accordance with the premium finance agreement. Loan finance charges or credit service charges accrue from the effective date of the insurance coverage for which the premiums are being advanced to and including the date when the final installment of the premium finance agreement is paid. (2) The loan finance charge or credit service charge shall not exceed the charges permitted under this law. The loan finance charge or credit service charge permitted by this Subsection anticipates repayment in consecutive monthly installments equal in amount for a period of one year. For repayment in greater or lesser periods or in unequal, irregular, or other than monthly installments, the credit service charge may be computed at an equivalent effective rate having due regard for the installments as scheduled. (3) Notwithstanding the provisions of any premium finance agreement, any insured may prepay the obligation in full at any time. In such an event he shall receive a refund credit consisting of precomputed finance charges or credit service charges that shall represent at least as great a proportion of the loan finance charge or credit service charge as the sum of the periodic balances after the month in which prepayment is made bears to the sum of all periodic balances under the schedule of installments in the agreement. Where the amount of the refund credit is less than one dollar, or to the extent provided for by federal law, no refund need be made. F. A premium finance agreement may provide for the payment by the insured of the delinquency charge in accordance with R.S. 9:3527, the N.S.F. check charge in accordance with R.S. 9:3529, an origination fee in accordance with R.S. 9:3530(A), attorney collection fees in accordance with R.S. 9:3534, and any charges as provided in this Subsection and in Subsection E. If the nonpayment by the consumer results in default and subsequently, results in cancellation of any insurance contract listed in the agreement, the agreement may provide for the payment by the insured of a cancellation charge not to exceed twenty-five dollars, which need not be rebated or credited to the consumer in the event that the premium finance agreement is subsequently reinstated. G. Insurance contracts may be canceled upon default as follows: (1) When a premium finance agreement contains a power of attorney enabling the insurance premium finance company to cancel any insurance contract, or contracts, or endorsements listed in the agreement, the insurance contract, or contracts, or endorsements shall not be canceled by the insurance premium finance company unless such cancellation is effectuated in accordance with this Subsection. (2) Upon default of the insurance premium finance agreement by the debtor, the premium finance company shall mail or send an electronic notice of cancellation to the insured, at his last known mailing or electronic address as shown on the records of the insurance premium finance company. In the event the default is not timely cured as provided herein and the insurance policy is canceled pursuant to the terms of the insurance premium finance agreement, a copy of the notice of cancellation of the insurance contract shall also be sent to the insurance agent negotiating the related insurance contract whose name and place of business appears on the insurance premium finance agreement. Such notice of cancellation shall also state the name of any governmental agency, holder of a security interest in the insured property, or third party also requiring notice of cancellation as shown on the insurance premium finance agreement. (3)(a) Ten days after notice of cancellation has been mailed to the insured, or fourteen days when notice is sent from outside of this state, if the default has not been cured, the insurance premium finance company may thereafter effect cancellation of such insurance contract, or contracts, or endorsements by sending to the insurer, by depositing in the mail or with a private carrier, or via electronic mail, within five business days after the date of cancellation, except when the payment has been returned uncollected, a copy of the notice of cancellation together with a statement certifying that: (i) The premium finance agreement contains a valid power of attorney as provided in Paragraph (1) of this Subsection. (ii) The premium finance agreement is in default and the default has not been timely cured. (iii) Upon default, a notice of cancellation was sent to the insured as provided in Paragraph (2) of this Subsection, specifying the date of sending by the premium finance company to the insured. (iv) Copies of the notice of cancellation were sent to all persons shown by the premium finance agreement to have an interest in any loss which may occur thereunder, specifying the names and addresses of any governmental agencies, holders of a security interest in the insured property, or third parties to whom the insurance premium finance company has sent notice of cancellation. (b)(i) Upon receipt of such notice of cancellation and statement from the premium finance company, the insurer shall consider that cancellation of the insurance contract or contracts has been requested by the insured but without requiring the return of the insurance contract or contracts and the insurer may proceed to cancel such contract or contracts as provided in R.S. 22:637. The effective date of cancellation shall be as of 12:01 a.m. on the tenth day after the date of sending of the notice of cancellation as shown in said statement furnished to the insurer by the premium finance company. (ii) The time period between the date of the late notice and notice of cancellation was sent shall commence upon the date the late notice is sent. (iii) Payment of an insurance premium installment by the insured, or on behalf of the insured, with a check or other instrument, which is returned to the premium finance company by the financial institution or other entity upon which it is drawn for insufficient funds available in the account, lack of credit, closed account, stopped payment, or for any other reason, shall be deemed grounds for the premium finance company to cancel the insurance policy pursuant to the terms of the power of attorney from the date the insurance policy could have been canceled upon default for nonpayment. (c) The receipt of such notice of cancellation and statement by the insurer shall create a conclusive presumption that the facts stated in said notice and statement are correct, that the insurer is entitled to rely on such facts and that the cancellation of the insurance contract or contracts is concurred in and authorized by the insured. No liability of any nature whatsoever either in favor of the insured, any governmental agency, holder of a security interest in the insured property, or third party shall be imposed upon the insurer as a result of any misstatement of fact contained in said notice of cancellation or statement furnished by the insurance premium finance company to the insurer, or as a result of failure by the insured, any governmental agency, holder of a security interest in the insured property, or third party to receive the notice of cancellation required by Paragraph (2) of this Subsection, or as a result of failure of the insurance premium finance company to comply with any of the requirements of this Subsection. Upon mailing of any unearned premium and unearned commission to the insurance premium finance company as soon as practicable following such cancellation, the insurer shall be fully discharged from all liability under the insurance contract or contracts for any loss occurring subsequent to the effective date of cancellation. (4) Upon receipt of the notice of cancellation, the insurer shall give notice to any governmental agency, holder of a security interest in the insured property, or other third party as shown in the records of the insurer requiring statutory, regulation, or contractual notice and which were not given by the premium finance company as provided in Paragraph (3) of this Subsection. The insurer shall give the prescribed notice on behalf of itself or the insured to any governmental agency, holder of a security interest in the insured property, or third party on or before the fifth business day after the day it receives a copy of the notice of cancellation from the insurance premium finance company and shall determine the effective date of cancellation taking into consideration the number of days notice required to complete the cancellation if such notice is given by the insurer, otherwise the effective date of cancellation shall be calculated from the date the premium finance company sent the notice to such governmental agency, holder of a security interest in the insured property, or other third party taking into consideration the number of days notice required to complete the cancellation. H. Whenever the financed insurance contract, or contracts, or endorsements are canceled, the insurer shall return whatever unearned premiums and unearned commissions that are due under the insurance contract to the insurance premium finance company for the account of the insured or insureds as soon as reasonably possible but in no event shall the period for payment exceed sixty days after the effective date of cancellation. In the event that the crediting of return premiums and commissions to the account of the insured results in a surplus over the amount due from the insured, the insurance premium finance company shall refund such excess to the insured within sixty days of receipt of the proceeds from the insurer unless the commissioner grants, upon a showing of good cause, an extension pursuant to a request for additional time, provided that no such refund shall be required if it amounts to less than one dollar, or to the extent provided by federal law. The parties to an insurance premium finance agreement may agree that the unearned premiums and unearned commissions may be retained by or paid to the insurance company in order to purchase continued coverage under the insurance contract. In such event, the insurance premium finance company shall only retain the funds necessary to pay the amount required to pay the insurance premium finance agreement in full and shall transfer such excess funds to the insurance company in a timely manner to assure that the insurance coverage is not terminated. When the insurance agent provides proof that any check, money order, bank draft, or other means of payment used to pay the down payment was returned by the financial institution for whatever reason, the refund of surplus funds shall be made from the lender to the agent. The refund shall be made payable to both the agent and the insured. I. No filing of the premium finance agreement shall be necessary to perfect the validity of such agreement as a secured transaction as against creditors, subsequent purchasers, pledges, encumbrances, successors, or assigns. J. No insurer or its agent may refuse to issue a policy of insurance solely because the premiums therefor have been advanced by a premium finance company licensed in Louisiana. Nor shall any insurer or its agent discriminate, intimidate, or retaliate against a producing agent/broker who uses premium financing by denying him the same rights accorded agents/brokers whose insureds pay their policies in a different manner.
LA Louisana Official State Statutes
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