TENNESSEE CODE ANNOTATED

TITLE 56. INSURANCE

CHAPTER 49. CREDITOR-PLACED INSURANCE ACT OF 1999

§ 56-49-103

As used in this chapter, unless the context otherwise requires:

(p) "Single interest insurance" means insurance purchased by the creditor to insure its interest in the collateral securing a debtor's credit transaction. Three (3) conditions must be met for payment of loss under the policy:

(1) The debtor has defaulted in payment;

(2) The creditor has legally repossessed the collateral, unless collateral has been stolen from the debtor; and

(3) The creditor has suffered an impairment of interest.

TENNESSEE 1999 SESSION LAWS

1999 SESSION OF THE 101ST GENERAL ASSEMBLY

Pub. Ch. 144

S.B. No. 1712

CREDITOR-PLACED INSURANCE ACT OF 1999

§ 56-49-113

(a) A creditor shall not impose charges, including premium costs and related interest and finance charges, on a debtor for creditor-placed insurance coverage unless adequate disclosure of the requirement to maintain insurance has been made to the debtor. Adequate disclosure is accomplished if the following occurs:

(1) The credit agreement sets forth the requirement that the debtor must maintain insurance on the collateral as provided for in § 56-49-111;

(2) The creditor makes reasonable efforts to notify the debtor of the requirement to maintain insurance and allows a reasonable time for compliance with this requirement;

(3) A final notice as required by this act is sent to the debtor; and

(4) If creditor-placed insurance coverage is issued, a copy of the policy or certificate is sent to the debtor as provided for in § 56-49-107.

(b) After adequate disclosure of the request to maintain insurance has been made to the debtor as required by this section, a creditor may proceed to impose charges for creditor-placed insurance if the debtor fails to provide evidence of insurance. A creditor may impose charges no earlier than ten (10) calendar days after sending the final notice.

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