NAC690A.070. Rights and treatment of debtors: Termination of group policy; refinancing of debt; prepayment of debt.

     1. If a debtor is covered by a group policy of consumer credit insurance that requires the payment of single premiums to the insurer, or any other premium payment method that prepays coverage beyond 1 month, the insurer shall provide that in the event of termination of the policy for any reason, insurance coverage with respect to any debtor insured under the policy continues for the entire period for which the premium has been paid.

     2. If a debt that is covered by a policy of consumer credit insurance is refinanced, the effective date of the coverage by any provision of the policy shall be deemed to be the first date on which the debtor became insured under the policy with respect to the debt which was refinanced, at least to the extent of the amount and term of the debt outstanding at the time the debt was refinanced.

     3. If a debt is prepaid in full as the result of death or any other lump-sum payment under a policy of consumer credit insurance:

     (a) No refund of a premium paid by the debtor for coverage of the debt is required.

     (b) If a claim under credit accident and health coverage or credit unemployment coverage is in progress at the time of prepayment, the refund of a premium paid by the debtor may be determined as if the prepayment did not occur until the payment of benefits terminates.

     (c) No refund of a premium paid by a debtor is required for any period of disability for which credit accident and health benefits are payable or during any period of unemployment for which credit unemployment benefits are payable. A refund of a premium paid by a debtor must be computed as if prepayment occurred at the end of the period of disability or unemployment.

     (Added to NAC by Comm’r of Insurance by R131-05, eff. 10-31-2005)