(a) A premium finance company, seller, building or savings and loan association, bank, trust company, industrial loan and thrift company or credit union authorized to do business in this state that finances insurance premiums, shall be deemed to have a perfected assignment and security interest in any premiums financed if the buyer or borrower signs a written agreement assigning a security interest in the premiums financed to the premium finance company, seller, seller’s assignee, or lender. No filing or other recordation of the premium finance agreement or financing statement shall be necessary to perfect the validity of the agreement as a valid assignment and secured transaction as against creditors, subsequent purchasers, pledgees, encumbrancers, trustees in bankruptcy or any other insolvency proceeding under any law, or anyone having the status or power of the aforementioned or their successors or assigns.

Terms Used In Tennessee Code 56-37-112

  • Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
  • Premium finance agreement: means an agreement by which an insured or prospective insured promises to pay to a premium finance company the amount advanced or to be advanced under the agreement to an insurer or to an insurance agent or producing agent in payment of premiums of an insurance contract, together with interest and a service charge as authorized and limited by this chapter. See Tennessee Code 56-37-102
  • Premium finance company: means a person engaged in the business of entering into premium finance agreements or acquiring premium finance agreements from other premium finance companies. See Tennessee Code 56-37-102
  • Premiums financed: means any interest assigned pursuant to a premium finance agreement or other assignment in or relating to an insurance policy or contract of insurance, to the extent of the rights retained by an assignor or assignee of that policy or contract of insurance for the refund of premiums and related charges paid. See Tennessee Code 56-37-102
  • Savings and loan association: includes a building and loan association, a federal or state savings and loan association, a federal savings bank, and any other financial institution, the accounts of which are insured by the [former] federal savings and loan insurance corporation (FSLIC) or any successor [repealed] of such corporation. See Tennessee Code 1-3-105
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • written: includes printing, typewriting, engraving, lithography, and any other mode of representing words and letters. See Tennessee Code 1-3-105
(b) Title 47, chapter 9, shall govern the relative priorities of security interests in, and any right of set-off against, funds advanced pursuant to a premium finance agreement or cash proceeds of a premium financed.
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