72A.31 CERTAIN ACTS DEEMED UNFAIR METHOD OF COMPETITION.
Subdivision 1. Real and personal property financing; prohibited acts by businesses.
person, firm or corporation engaged in the business of financing the purchase of real or personal
property or of lending money on the security of real or personal property or who acts as agent
or broker for one who purchases real property and borrows money on the security thereof, and
no trustee, director, officer, agent or other employee of any such person, firm, or corporation
shall directly or indirectly:
(1) require, as a condition precedent to such purchase or financing the purchase of such
property or to loaning money upon the security of a mortgage thereon, or as a condition
prerequisite for the renewal or extension of any such loan or mortgage or for the performance
of any other act in connection therewith, that the person, firm or corporation making such
purchase or for whom such purchase is to be financed or to whom the money is to be loaned or for
whom such extension, renewal or other act is to be granted or performed negotiate any policy of
insurance or renewal thereof covering such property through a particular agent, or insurer, or
(2) refuse to accept any policy of insurance covering such property because it was not
negotiated through or with any particular agent, or insurer, or
(3) refuse to accept any policy of insurance covering the property issued by an insurer that is
a member insurer as defined by section
60C.03, subdivision 6
(4) require any policy of insurance covering the property to exceed the replacement cost
of the buildings on the mortgaged premises.
This section shall not prevent the disapproval of the insurer or a policy of insurance by
any such person, firm, corporation, trustee, director, officer, agent or employee where there
are reasonable grounds for believing that the insurer is insolvent or that such insurance is
unsatisfactory as to placement with an unauthorized insurer, adequacy of the coverage, adequacy
of the insurer to assume the risk to be insured, the assessment features to which the policy is
subject, or other grounds which are based on the nature of the coverage and which are not
arbitrary, unreasonable or discriminatory, nor shall this section prevent a mortgage lender or
mortgage servicer from requiring that a policy of insurance or renewal thereof be in conformance
with standards of the Federal National Mortgage Association or the Federal Home Loan Mortgage
Corporation, nor shall this section forbid the securing of insurance or a renewal thereof at the
request of the borrower or because of the borrower's failure to furnish the necessary insurance or
renewal thereof. For purposes of this section, "insurer" includes a township mutual fire insurance
company operating under sections
and a farmers mutual fire insurance company
operating under sections
Upon notice of any such disapproval of or refusal to accept an insurer or a policy of
insurance, the commissioner may order the approval of the insurer or the acceptance of the
tendered policy of insurance, or both, if the commissioner determines such disapproval or refusal
to accept is not in accordance with the foregoing requirements. Failure to comply with such an
order of the commissioner of commerce shall be deemed a violation of this section.
Subd. 2. Public agency construction insurance or bond; prohibited acts.
It shall be
unlawful in connection with any contract or subcontract calling for any construction work for
a public agency to require, directly or indirectly, that any insurance or bond be purchased or
renewed through a particular agent or insurer.
History: 1967 c 395 art 12 s 31; 1969 c 229 s 1; 1969 c 433 s 1; 1983 c 289 s 114 subd 1;
1984 c 655 art 1 s 92; 1986 c 444; 1987 c 337 s 120