The following practices, when engaged in either directly or by reciprocal agreement by an insurer or by any insurance agent in connection with the sale or placement of credit insurance as an inducement thereto, shall constitute unfair methods of competition: (1) the offer or grant by an insurer or by any insurance agent to a creditor or to any person connected with the creditor or to any person connected with the creditor of any special advantage or any service not set out in the group insurance contract; (2) agreement by an insurer or by an insurance agent to deposit with a bank or financial institution money or securities of the insurer with the design or intent that the same shall affect or take the place of a deposit of money or securities which otherwise would be required of the creditor by such bank or financial institution as a compensating balance or offsetting deposit for a loan or other advancement; and
(3) deposit as an inducement to insurance by an insurer or by an insurance agent of money or securities, regardless of interest or yield, in a creditor bank or financial institution. This paragraph shall not be construed to prohibit the maintenance by an insurer of such demand deposits or premium deposit accounts as are reasonably necessary for use in the ordinary course of the insurer's business. However, premiums shall be remitted to the insurer within 60 days of their due dates and for purposes of this subchapter only, the deposit of such premiums to any such demand deposit account with the creditor and their continued retention therein for more than 60 days shall not be deemed remittance to the insurer.
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