69V-160.025. Property Insurance on Loans

(1) Coverage. When, at the written request of the borrower, the licensee places insurance to protect household goods and appliances used as collateral for a loan, the policy shall include coverage against the perils of fire and broad-form extended coverage. At the option of the borrower, the policy may contain the following coverages: transportation and change of location; burglary; and rental reimbursement in event of loss.

(2) Issuer. A licensee may provide property insurance only on written authorization signed by the borrower through a duly licensed agent and an insurance company qualified by the Insurance Commissioner to do business in the State of Florida.

(3) Insurance voluntary. The borrower shall not be required to purchase a policy from any certain company, agent, broker or person as a condition precedent to the granting of a loan. Purchase of property insurance, from the licensee, shall be entirely voluntary on the part of the borrower and so stated in a signed application requesting the licensee to place property insurance on the collateral.

(4) Forms and rates. The policy forms and rates charged must be in compliance with the Florida Insurance Code and regulations of the Commissioner of Insurance. The licensee shall retain, on the premises of the lending institution office, complete copies of the policy forms used and manuals of rates charged.

(5) Limitation. Property insurance may not be placed where there are not specific household or appliance goods offered as collateral or where the borrower has valid and collectible fire and extended coverage insurance on the same collateral to offer the licensee.

(6) Delivery of policy. The licensee shall deliver or cause to be delivered to the borrower evidence of insurance at the time the loan is made and deliver or cause to be delivered to the borrower a copy of the policy within fifteen days from the date the loan was made.

(7) Amount. The amount of property insurance shall be limited to the amount of indebtedness or the reasonable value of the property insured, whichever is less.

(8) Unearned premium. The unearned premium resulting in cancellations shall be computed and refunded in accordance with the cancellation provisions of the insurance policy placed by the licensee on behalf of the borrower. Any minimum retained premium shall not exceed $3.00. A pro rata refund shall be allowed on loan renewals.

(9) Total losses. On total losses, the property insurance shall pay the original amount of insurance, regardless of the value of the property or the amount owing at the time such total loss occurs. Partial losses shall be settled on an actual cost to repair or replace basis and there shall be no deductions from the amount of settlement for depreciation or betterment.

(10) Description. Where the licensee provides property insurance on specific household or appliance goods, the credit files of the licensee shall contain a description sufficient for identification of all the property insured as collateral.

(11) Collateral Insurance. When real or personal property, other than household goods and appliances, are used as collateral for a loan and the borrower is required, by the loan contract, to keep the collateral insured, a physical damage policy may be required naming the licensee as “Loss Payee.” Should such insurance expire or be cancelled, the borrower may be required to furnish the licensee with replacement coverage. Should the borrower fail to furnish such a policy on written request, either a vendor’s single interest or a dual interest replacement policy may be obtained by the licensee and the premium charged to the loan account.

Rulemaking Authority 20.05(5), 516.22(1) FS. Law Implemented 516.031(3) FS. History–New 9-1-75, Amended 8-16-83, Formerly 3D-160.25, 3D-160.025, Amended 10-29-12.