W. Va. Code R. § 114-61-4

Current through Register Vol. XLII, No. 1, January 3, 2025

Section 114-61-4 - Disclosure to Debtors; Provisions of Policies; and Certificates of Insurance

4.1. The following shall be disclosed to the debtor in writing, and may be combined with other disclosures required by W. Va. Code § 46A-3-109(b)(4), or by federal laws and regulations:

4.1.a. That the purchase of credit personal property insurance through the creditor is optional and not a condition of obtaining credit approval;

4.1.b. If more than one kind of credit insurance is being made available to the debtor, that the debtor can purchase credit personal property insurance separately;

4.1.c. That if the consumer has other insurance that covers the risk, he or she may not want or need credit personal property insurance;

4.1.d. That within the first thirty days after receiving the individual policy or certificate of insurance, the debtor may cancel the coverage and have all premium paid by the debtor refunded or credited. Thereafter, the debtor may cancel the policy at any time during the term of the loan and receive a refund of any unearned premium. However, only in those instances where the creditor requires evidence of insurance for the extension of credit, the debtor may be required to offer evidence of alternative insurance acceptable to the creditor at the time of cancellation;

4.1.e. If not already contained in the certificate or policy received contemporaneously with the credit transaction, a brief description of the coverage, including a description of the major perils and exclusions, any deductible, to whom the benefits would be paid, and the premium or premium rate for the credit personal property coverage; and

4.1.f. If the premium or insurance charge is financed, that it will be subject to finance charges at the rate applicable to the credit transaction.

4.2. The disclosures required in subsection 4.1 of this section shall be provided in the following manner:

4.2.a. In connection with credit personal property insurance offered contemporaneously with the extension of credit or offered through direct mail advertisements, the disclosures shall be made in writing and presented to the consumer in a clear and conspicuous manner; and

4.2.b. When the offer of credit personal property insurance is subsequent to the extension of credit or not offered by direct mail advertisements, the disclosures may be provided in conjunction with the offer either orally or electronically so long as written disclosures are provided to the debtor no later than the earlier of:

4.2.b.1. Ten days after the election to purchase the credit personal property insurance; or

4.2.b.2. The date any other written material is provided to the debtor.

4.3. An offer to extend coverage for an open-end consumer transaction shall include, at the time of the invitation to contract, the written disclosure below in no smaller than twelve-point type. If the solicitation is made by telephone the disclosure may be summarized and given orally, provided that written disclosure is mailed to the debtor within ten days of enrollment.

"This coverage might duplicate existing coverage if you have a residential property insurance policy. It applies to any item of covered property on which you owe a debt. This coverage is primary, so it is the first source to be used in the event of a loss on property it covers. You may cancel this coverage at any time by calling the insurer at the telephone number provided to you, or by writing to the insurer. We are charging you a premium that may be based on things for which a claim cannot be made, such as services, meals or other consumables, entertainment, finance or service fees, loan interest, delivery charges or other insurance premiums."

4.4. All credit personal property insurance shall be evidenced by an individual policy or a certificate of insurance that shall be delivered to the debtor. The individual policy or certificate of insurance shall, in addition to other requirements of law, set forth the following:

4.4.a. The name and home office address of the insurer;

4.4.b. The name or names of the debtor or debtors, or, in the case of a certificate of insurance, the identity by name or otherwise of the debtor or debtors;

4.4.c. The premium or amount of payment by the debtor, except that for open-end credit, the premium rate and balance to which the rate applies shall be specified;

4.4.d. A full description of the coverage or coverages including the amount and term thereof, and any exceptions, limitations, and exclusions;

4.4.e. A statement that the benefits shall be paid to the creditor to reduce or extinguish the unpaid debt or to repair or replace the property and, whenever the amount of loss payment exceeds the unpaid debt, that any excess payment shall be payable to the debtor;

4.4.f. If the scheduled term of the insurance is less than the scheduled term of the credit transaction, a statement to that effect on the face of the individual policy or certificate of insurance in not less than twelve-point bold face type; and

4.4.g. If the policy is issued to cover open-end consumer transactions, it shall provide that the policyholder or certificate holder will be furnished the following disclosure notice with the account statement at least annually in no smaller than twelve-point type:

"You are paying credit property insurance premium based on the outstanding balance of this account. You may cancel this coverage at any time by calling the insurer at the telephone number the insurer has provided to you, or by writing to the insurer. Your premium may be based on things for which a claim cannot be made, such as services, meals or other consumables, entertainment, finance or service fees, loan interest, delivery charges, or other insurance premiums."

4.5. Except as provided in subsection 4.6, the individual policy or group certificate shall be delivered to the debtor upon acceptance of the insurance by the insurer.

4.6. An individual policy or group certificate delivered in conjunction with an open-end credit agreement or any credit personal property insurance requested by the debtor after the date the indebtedness is incurred shall be delivered within thirty days of the date the insurance is requested by the debtor.

W. Va. Code R. § 114-61-4