(a) The contents and style of the premium finance agreement shall be as follows:
Terms Used In Alabama Code 27-40-8
Annual percentage rate: The cost of credit at a yearly rate. It is calculated in a standard way, taking the average compound interest rate over the term of the loan so borrowers can compare loans. Lenders are required by law to disclose a card account's APR. Source: FDIC
Contract: A legal written agreement that becomes binding when signed.
(1) It shall be dated, signed by the insured or an authorized representative and the printed portion thereof shall be in at least eight-point type.(2) It shall contain the name and place of business of the insurance agent negotiating the related insurance contract, the name and residence, or place of business, of the insured as specified by the insured, the name and place of business of the premium finance company to which payments are to be made, a description of the insurance contracts or wind mitigation construction financing involved, and the amount of the premium or other charges therefor.(3) It shall set forth the following items where applicable:
a. The total amount of the premiums and other approved charges.b. The amount of the down payment.c. The principal balance, that being the difference between items a. and b.d. The amount of the service charge.e. The balance payable by the insured, that being the sum of items c. and d.f. The number of installments required, the amount of each installment expressed in dollars, and the due date or period thereof.g. The annual percentage rate (APR) charged.(b) The items set out need not be stated in the sequence or order in which they appear, and additional items may be included to explain the computations made in determining the amount to be paid by the insured.
