| (a) Purpose. This section only applies to a motor vehicle
retail installment sales transaction under Texas Finance Code, Chapter
348 where a charge for insurance or debt cancellation agreement is
included in the balance due under the retail installment sales contract.
This section does not apply to insurance sold outside of the retail
installment sales transaction.
(b) Authorized credit insurance. Authorized credit
insurance includes credit life, credit accident and health insurance,
credit involuntary unemployment insurance, and dual-interest gap insurance.
The retail seller may but is not required to offer the authorized
credit insurance products described in this section.
(c) Decreasing term coverage for credit life, credit
accident and health, and involuntary unemployment insurance. Credit
life insurance, credit accident and health insurance, and involuntary
unemployment insurance written in connection with a Texas Finance
Code, Chapter 348 motor vehicle retail installment sales contract
must be decreasing term insurance.
(d) Lawful rates and terms for credit life and credit
accident and health insurance. Credit life insurance and credit accident
and health insurance must be written in compliance with Texas Insurance
Code, Chapters 1131 and 1153, and any regulations issued by the Texas
Department of Insurance under the authority of those provisions.
(e) Lawful rates and terms for involuntary unemployment
insurance. Involuntary unemployment insurance must be written in compliance
with Texas Insurance Code, Chapter 3501, and any regulations issued
by the Texas Department of Insurance under the authority of that chapter.
(f) Lawful rates and terms for dual-interest gap insurance.
Dual-interest gap insurance, authorized by Texas Finance Code, §348.208(b)(4),
must be written at rates and on forms set and filed in accordance
with Texas Insurance Code, Chapters 2251 and 2301, and any regulations
issued by the Texas Department of Insurance under the authority of
those provisions.
(g) Authorized insurance and surplus lines insurance
companies. For retail installment sales transactions involving ordinary
vehicles, credit insurance must be procured from an insurance company
authorized to do business in this state. Surplus lines insurance companies
are not authorized to offer credit insurance on a Chapter 348 motor
vehicle retail installment sales contract.
(h) Debt cancellation agreements. Debt cancellation
agreements are not credit insurance. For retail installment sales
transactions involving ordinary vehicles, debt cancellation agreements
that cancel all or part of the retail buyer's obligation to repay
the retail installment sales contract based upon the occurrence of
death, disability, or unemployment of the retail buyer are not authorized
to be sold or written with a Chapter 348 motor vehicle retail installment
sales contract. A debt cancellation agreement may be offered in connection
with a Chapter 348 motor vehicle retail installment sales transaction
and included as a term of, or modification to, the retail installment
sales contract if the debt cancellation agreement is written in compliance
with:
(1) Texas Finance Code, §348.124 and §84.308
of this title; or
(2) Texas Finance Code, Chapter 354.
|
| Source Note: The provisions of this §84.302 adopted to be effective July 10, 2008, 33 TexReg 5280; amended to be effective March 14, 2010, 35 TexReg 1959; amended to be effective September 8, 2011, 36 TexReg 5671; amended to be effective September 7, 2017, 42 TexReg 4462 |
