62B.05 TERM OF CREDIT INSURANCE.
The term of any credit life insurance, credit accident and health insurance, or credit
involuntary unemployment insurance shall, subject to acceptance by the insurer, commence on
the date when the debtor becomes obligated to the creditor, except that, where a group policy
provides coverage with respect to existing obligations, the insurance on a debtor with respect
to the indebtedness shall commence on the effective date of the policy. Where evidence of
insurability is required and the evidence is furnished more than 30 days after the date when the
debtor becomes obligated to the creditor, the term of the insurance may commence on the date on
which the insurance company determines the evidence to be satisfactory, and in that event there
shall be an appropriate refund or adjustment of any charge to the debtor for insurance. The term
of the insurance shall not extend more than 15 days beyond the scheduled maturity date of the
indebtedness except when extended without additional cost to the debtor.
If an indebtedness is prepaid in full before its scheduled maturity, except by performance of
the insurer's obligation under the policy, the insurance shall be deemed canceled and a refund
shall be paid or credited as provided in section
. Upon prepayment in full, the creditor shall
make the refund of unearned premium, unless the credit insurance was originated by a third party,
in which case the creditor shall promptly notify the third party who shall make the refund.
History: Ex1967 c 2 s 5; 1977 c 382 s 4; 1978 c 641 s 1; 1Sp1985 c 10 s 61; 1986 c 455 s
87; 1993 c 343 s 12