Section Ins 1201.05 - Premium Refunds(a) In the event of termination of the insurance prior to the scheduled maturity date of the indebtedness, other than as a result of the death of the insured, a refund of the unearned insurance premium or charge without any deduction whatsoever shall be made or credited promptly to the debtor in accordance with the methods in (b) through (h) below.(b) In the case of all credit life insurance which decreases uniformly so as to cover the scheduled indebtedness at any time during the term of the indebtedness, the following method, known as the "rule of 78", shall apply: (2) Where "t" means the number of months remaining under the terms of the coverage; and(3) Where "n" means the total number of coverage months.(c) In the case of credit accident and health insurance, the following method, known as the "pure premium" method, shall apply. The refund under this method shall be computed as the premium which would have been charged for such insurance at the time originally purchased except for the amount of the total remaining benefits and for the remaining term of the indebtedness outstanding at the date of termination.(d) As an alternative to the pure premium method, an insurer may elect for a particular account or accounts to refund an amount equal to the average of the refunds computed by the "rule of 78" method and the pro rata method. If this alternative method is elected, all refunds thereafter shall be calculated consistent with this alternative method.(e) In the case of level credit life insurance, the refund shall be determined by the pro rata method.(f) Under methods (a) through (e) above, if 16 days or more of a loan month have been earned, the refund may be computed from the end of the loan month provided that, if 15 days or less of a loan month have been earned, the refund is computed from the beginning of the loan month. Alternatively, the refund for partial months of coverage may be computed on a pro rata basis.(g) No refund of $1.00 or less shall have to be made.(h) Credit insurance policies and group certificates shall specify the method that will be used to compute refunds for each plan of insurance provided by the policy or group certificate. Compliance with the above requirement shall be considered to fulfill the requirements in RSA 408-A that refund formulas be filed with the commissioner where either the rule of 78, the pro rata, or the pure premium method is in use.N.H. Admin. Code § Ins 1201.05
#1900, eff 1-1-82; ss by #2441, eff 1-1-84; ss by #4287, eff 7-1-87; ss by #5650, eff 7-1-93, EXPIRED 7-1-99
New. #7146, eff 4-1-00, EXPIRED: 4-1-08
New. #9611, eff 1-4-10
Amended by Volume XXXVIII Number 06, Filed February 8, 2018, Proposed by #12474, Effective 2/2/2018, Expires 2/2/2028.