(a) A premium finance agreement must be in writing on a form approved by the commissioner.
(b) A premium finance agreement must be dated and signed by the insured. An agreement may be signed on behalf of the insured by the insured’s agent if:
(1) the agreement contains policies for other than personal, family, or household purposes; and
(2) the premiums for the policies exceed $1,000.

Terms Used In Texas Insurance Code 651.151

  • Contract: A legal written agreement that becomes binding when signed.
  • Finance charge: The total cost of credit a customer must pay on a consumer loan, including interest. The Truth in Lending Act requires disclosure of the finance charge. Source: OCC
  • in writing: includes any representation of words, letters, or figures, whether by writing, printing, or other means. See Texas Government Code 312.011
  • Signed: includes any symbol executed or adopted by a person with present intention to authenticate a writing. See Texas Government Code 311.005

(c) A premium finance agreement must contain:
(1) the name and business address of the insurance agent or broker negotiating the related insurance contract;
(2) the name and residence or business address of the insured as specified by the insured;
(3) the name and business location of the insurance premium finance company to which payments are to be made;
(4) a description of each insurance contract involved;
(5) the amount of the premium for each insurance contract;
(6) the total amount of the premiums for all insurance contracts;
(7) the amount of any down payment;
(8) the principal balance, which is the difference between the amounts under Subdivisions (6) and (7);
(9) the total amount of the finance charge, which must describe each amount included and use the term “finance charge”; and
(10) the balance payable by the insured, which is the sum of the amounts under Subdivisions (8) and (9).

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