Except as provided under Subsection (2), the initial amount of credit life insurance on the life of any one debtor may not exceed the total amount repayable under the contract of indebtedness. Where an indebtedness is repayable in substantially equal periodic installments, the amount of insurance may not exceed the scheduled or actual amount of unpaid indebtedness, whichever is greater.
Terms Used In Utah Code 31A-22-804
Accident and health insurance: means insurance to provide protection against economic losses resulting from:
completed by an applicant to provide information about the risk to be insured; and
(ii)
that contains information that is used by the insurer to evaluate risk and decide whether to:
(A)
insure the risk under:
(I)
the coverage as originally offered; or
(II)
a modification of the coverage as originally offered; or
(B)
decline to insure the risk; or
(b)
used by the insurer to gather information from the applicant before issuance of an annuity contract. See Utah Code 31A-1-301
Contract: A legal written agreement that becomes binding when signed.
Credit transaction: means any transaction under which the payment for money loaned or for goods, services, or properties sold or leased is to be made on future dates. See Utah Code 31A-22-802
Creditor: means the lender of money or the vendor or lessor of goods, services, or property, for which payment is arranged through a credit transaction, or any successor to the right, title, or interest of any lender or vendor. See Utah Code 31A-22-802
Debtor: means a borrower of money or a purchaser, including a lessee under a lease intended as security, of goods, services, or property, for which payment is arranged through a credit transaction. See Utah Code 31A-22-802
Disability: means a physiological or psychological condition that partially or totally limits an individual's ability to:
(a)
perform the duties of:
(i)
that individual's occupation; or
(ii)
an occupation for which the individual is reasonably suited by education, training, or experience; or
(b)
perform two or more of the following basic activities of daily living:
Indebtedness: means the total amount payable by a debtor to a creditor in connection with a credit transaction, including principal finance charges and interest. See Utah Code 31A-22-802
Indemnity: means the payment of an amount to offset all or part of an insured loss. See Utah Code 31A-1-301
Insurance: includes :
(i)
a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;
(ii)
a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and
(iii)
a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301
insurance on agricultural credit transaction commitments not exceeding the commitment period, which may be written for the amount of the commitment on a nondecreasing or level term plan;
(b)
insurance on educational credit transaction commitments, which may be written to include the portion of the commitment that has not been advanced by the creditor;
(c)
insurance on preauthorized lines of credit not exceeding the commitment period which may be written for the preauthorized amount on a nondecreasing or level term plan, whether secured or unsecured; and
(d)
insurance on any other class of lawful credit transaction or commitment, which in the commissioner’s opinion does not require the application of the restrictions under Subsection (1), in which case the commissioner may authorize by rule a class exception to Subsection (1).
(3)
The total amount of indemnity payable by credit accident and health insurance in the event of disability, as defined in the policy, may not exceed the aggregate of the periodic scheduled unpaid installments of the indebtedness. The amount of each periodic indemnity payment may not exceed the total amount repayable under the contract of indebtedness divided by the number of periodic installments.
