Tenn. Comp. R. & Regs. 0780-01-07-.13 - PROCEDURES

The following procedures are published herewith as requirements which are deemed to be necessary for full compliance with the law as cited above:

(a) Purchasers or borrowers, in all credit transactions where insurance coverage is required, must not be misled concerning their right to purchase insurance from any insurance company licensed by this Department and which company provides the necessary coverage. The finance factor or creditor must act affirmatively in such cases in advising the borrower of his rights to a choice of companies or agents. Where insurance is required in transactions involving the purchase of motor vehicles, the finance factor or creditor need not accept as evidence of insurance a policy which does not contain a LOSS PAYABLE CLAUSE.

(b) When the purchaser or borrower chooses to purchase insurance from the insurer represented by the finance factor or creditor, the seller must furnish the purchaser with evidence of the insurance at the time the sales contract or purchase order is executed. Such insurance evidence must be in the form of an insurance binder. The policy shall be delivered to the purchaser or borrower within twenty-five days following the execution of the initial evidence of insurance.

(c) Where single interest is written in connection with a finance or loan transaction, a clear and concise statement shall be furnished to the purchaser or borrower, advising him that the insurance effected is solely for the interest of the dealer, finance factor or lender, and that no protection thereunder exists for the benefit of the purchaser or borrower. Such policies shall be clearly stamped or printed in not less than fourteen-point type on the title page "SINGLE INTEREST ONLY."

Notes

Tenn. Comp. R. & Regs. 0780-01-07-.13

Original rule certified June 10, 1974.

Authority: T.C.A. § 56-2-301.