Section Ins 1201.16 - Special Rules For Open-End Credit Transactions(a) The procedures in this section shall govern the sale of credit insurance sold in connection with open-end credit transactions, which are sometimes called revolving charge accounts and similar names. Where not inconsistent, other sections of this part shall also apply to this category of credit insurance.(b) Coverage may be provided only under group insurance policies.(c) All credit insurance written hereunder shall be on the monthly outstanding balance basis.(d) Disclosure to debtor shall include: (1) If a certificate of insurance is not furnished to the debtor immediately when the account is opened, a notice of proposed insurance shall be given to the debtor, and a certificate shall be delivered to him or her within 30 days;(2) The notice, certificate, or both, shall show the effective date of the insurance;(3) The notice, certificate, or both shall prominently indicate any categories of persons excluded from coverage, or alternately, the rules governing eligibility, and shall further indicate with equal prominence any policy provisions which may cause a claim to be denied; and(4) The certificate shall describe the disposition of the proceeds of the life insurance upon the debtor's death.(e) A debtor under an open-end credit agreement may be enrolled only by his or her affirmative, written agreement, if a charge for the insurance is to be made to him or her. If benefits under the plan are to be reduced or if premiums are to be increased, notice of such action shall be given the debtor, and he or she shall be advised as to the manner in which he or she may discontinue the coverage.(f) The amount of life insurance during any monthly period shall not be less than the amount for which a premium has been paid by the debtor for that period. Any proceeds of a life insurance policy in excess of the amount required to discharge the indebtedness completely shall be paid to the beneficiary named by the debtor, or if none, to his or her estate.(g) A debtor's insurance may be terminated only as follows: (1) On the date the debtor requests termination;(2) On the date the debtor fails to pay the required premium;(3) On any billing date coinciding with or following attainment of the maximum age;(4) Upon default by the debtor, as defined in the creditor's rules, provided such rules do not discriminate against individual insured debtors;(5) Upon termination of the open-end credit agreement; or(6) Upon termination of the group policy after 30 days' notice to the debtor, unless there is immediate replacement of coverage by another insurer.(h) The premium rates charged for credit insurance covering open-end credit transactions shall be consistent with the premium rates charged for other forms of credit insurance. The actual premium rates specified in Ins 1201.18 apply to credit insurance covering open-end credit transactions as well as all other forms of credit insurance.(i) In the event of termination of a debtor's insurance, a pro rata refund of unearned premium, if any, shall be made to the debtor. No refund shall be required if it is less than $1.00.(j) With respect to credit accident and health insurance, the insurer may include provisions indicating that the pre-existing condition limitations are to apply separately to each advance.(k) The notice, certificate, or both, in (d)(1) above shall be furnished at least once while the account remains active.(l) The effective date of the insurance required to be disclosed in the notice and/or certificate in (d)(2) above shall not be later than 30 days after the debtor makes written application for such insurance and agrees to pay the required premium.N.H. Admin. Code § Ins 1201.16
#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.