(A) No insurer may participate in any consolidation, other than a loan transfer consolidation, unless it complies with the following requirements:

(1) The offer of new coverage must be made to the mortgage debtors not less than thirty days prior to the proposed effective date of the new coverage.

Terms Used In South Carolina Code 38-85-30

  • Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
  • Insurer: includes a corporation, fraternal organization, burial association, other association, partnership, society, order, individual, or aggregation of individuals engaging or proposing or attempting to engage as principals in any kind of insurance or surety business, including the exchanging of reciprocal or interinsurance contracts between individuals, partnerships, and corporations. See South Carolina Code 38-1-20
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Premium: means payment given in consideration of a contract of insurance. See South Carolina Code 38-1-20

(2) In conjunction with the offer of new coverage, the new insurer shall disclose in writing to each debtor the following:

(a) that the insured debtor may have the right to continue or convert his old coverage by paying premiums directly to the old insurer;

(b) that the offer of new coverage is not conditioned upon either the termination or replacement of the old coverage;

(c) the name and address of the old and the new insurer;

(d) the effective date of the new coverage;

(e) that the financial institution is the primary beneficiary of the new coverage;

(f) whether premium rates under the new plan are guaranteed;

(g) material differences between the new plan and the old plan;

(h) that payment of the required premium constitutes acceptance of the new coverage.

(B) An insurer which fails to comply with item (1) of subsection (A) of this section shall notify the debtor, in writing, that he has the right to an unconditional refund of all premiums paid for the new coverage as long as he exercises that right, in writing, within thirty days from the notification.

(C) Disclosures required under this section may be made on behalf of the new insurer by the financial institution.

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