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§ 23-301. Requirements for premium finance agreements

West's Annotated Code of MarylandInsuranceEffective: July 1, 2013

West's Annotated Code of Maryland
Insurance (Refs & Annos)
Title 23. Premium Financing
Subtitle 3. Premium Finance Agreements; Charges and Fees (Refs & Annos)
Effective: July 1, 2013
MD Code, Insurance, § 23-301
§ 23-301. Requirements for premium finance agreements
Date, signature, and type size requirements
(a)(1) A premium finance agreement shall be dated and signed by or on behalf of the insured.
(2) Except as provided under subsection (b)(5)(viii) of this section, the printed part of the premium finance agreement shall be in approximately 8-point type and be easily readable by an average individual.
Contents of premium finance agreement
(b) A premium finance agreement shall contain:
(1) the name and place of business of the insurance producer negotiating the related insurance contract;
(2) the name and residence or place of business of the insured as specified by the insured;
(3) the name and place of business of the premium finance company to which payments may be made;
(4) an itemized list for each insurance contract or coverage financed under the premium finance agreement that includes:
(i) the applicable application number, binder number, or policy number;
(ii) the effective date of the insurance contract or coverage;
(iii) the name of the company issuing the insurance contract or coverage; and
(iv) the premium for the insurance contract or coverage; and
(5) if applicable, the following items:
(i) the total amount of the premiums;
(ii) the amount of the down payment;
(iii) the principal balance (the difference between items (i) and (ii) of this item);
(iv) the amount of the finance charge;
(v) the balance payable by the insured (the sum of items (iii) and (iv) of this item);
(vi) the number of installments required, the amount of each installment expressed in dollars, and the due date or period of each installment;
(vii) the electronic payment fee; and
(viii) in at least 12-point type, the following statement: “If this agreement is canceled or the loan is prepaid in full before the end of its term, the actuarial method will be used to calculate the earned finance charge. Under this method, most of the finance charge is earned in the early months of the loan term rather than equally in each month. You may request a sample illustration of how the finance charge is earned.”.
Order of items
(c)(1) The items set out in subsection (b)(5) of this section need not be stated in the sequence in which they appear.
(2) Additional items may be included to explain the computations made in determining the amount to be paid by the insured.
(3) With respect to commercial automobile, fire, or liability insurance, a premium finance agreement may include separate provisions requiring representations, warranties, or other obligations of the insurance producer who sells, solicits, or negotiates the insurance policy, the premiums for which are financed under the premium finance agreement.
Additional insurance premiums
(d) A premium finance agreement may provide for additional insurance premiums to be financed and added to the initial premium finance agreement.
Monthly payments for purchase of motor club service contract
(e) Subject to §§ 23-501.1 and 23-505.2 of this title, a premium finance agreement may include monthly payments for the purchase price of a motor club service contract.

Credits

Added by Acts 1996, c. 11, § 1, eff. Oct. 1, 1997. Amended by Acts 1997, c. 708, § 1, eff. Oct. 1, 1997; Acts 2001, c. 731, § 1, eff. July 2, 2001; Acts 2003, c. 21, § 1, eff. April 8, 2003; Acts 2004, c. 211, § 1, eff. Oct. 1, 2004; Acts 2006, c. 194, § 1, eff. Oct. 1, 2006; Acts 2013, c. 334, § 1, eff. July 1, 2013.
Formerly Art. 48A, § 486C.
MD Code, Insurance, § 23-301, MD INSURANCE § 23-301
Current through all legislation from the 2022 Regular Session of the General Assembly. Some statute sections may be more current, see credits for details.
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