Section 1491 - Requirements and Limitations on Additional Required Insurance when Existing Insurance Expires Before Maturity of Loan(a) When required insurance exists in an amount sufficient to protect a finance company, but expired prior to the maturity date of a loan, such finance company may require additional insurance in a reasonable amount and for a reasonable period, considering the circumstances of the loan.(b) The premium on such additional renewed insurance shall not be charged to or collected from the borrower prior to the expiration of the existing required insurance except as provided in Section 1486 of these rules.(c) Such additional required insurance shall be made effective immediately upon said premium being charged to or collected from the borrower except as provided in Section 1486 of these rules.(d) If a finance company shall elect to place required insurance or act under any authorization taken from a borrower to write or procure additional insurance upon the expiration of existing insurance, it shall be the duty of such finance company to notify the borrower, at least fifteen days prior to the expiration date of the existing insurance, that it intends to write such additional insurance as authorized. If a finance company does not so notify the borrower, and such borrower shall have procured additional insurance prior to, and to be effective upon the expiration of the existing insurance, any insurance procured by the finance company pursuant to such authorization shall, on notice from the borrower, be canceled at no cost to the borrower.(e) If a finance company shall elect to act under any authorization taken from a borrower to write or procure additional insurance in the event of cancellation of existing insurance, it shall be the duty of such finance company to notify the borrower, within five days after receipt by the finance company of notice of cancellation, that it intends to write such additional insurance as authorized. If a finance company does not so notify the borrower, and such borrower shall have procured additional insurance prior to, and to be effective upon the cancellation of the existing insurance, any insurance procured pursuant to such authorization shall, on notice from the borrower, be canceled at no cost to the borrower.(f) Any notice by the finance company that it intends to place required insurance or sell additional insurance shall state the type of insurance to be sold, the effective date, the amount of the premium, any change in the terms of the loan and the amount of any additional precomputed charges.Cal. Code Regs. Tit. 10, § 1491
1. New NOTE filed 12-29-83; effective thirtieth day thereafter (Register 83, No. 53).
2. Change without regulatory effect amending subsections (d), (e) and NOTE filed 6-14-95 pursuant to section 100, title 1, California Code of Regulations (Register 95, No. 24). Note: Authority cited: Section 22150, Financial Code. Reference: Sections 22150, 22311, 22312 and 22313, Financial Code.
1. New NOTE filed 12-29-83; effective thirtieth day thereafter (Register 83, No. 53).
2. Change without regulatory effect amending subsections (d), (e) and Note filed 6-14-95 pursuant to section 100, title 1, California Code of Regulations (Register 95, No. 24).