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
Insurer: is a s defined in Section 31A-1-301, except that the following persons or similar persons are not insurers for purposes of 7:
(a)
a risk retention group as defined in:
(i)
the Superfund Amendments and Reauthorization Act of 1986, Pub. See Utah Code 31A-23a-102
Person: includes :
(a)
an individual;
(b)
a partnership;
(c)
a corporation;
(d)
an incorporated or unincorporated association;
(e)
a joint stock company;
(f)
a trust;
(g)
a limited liability company;
(h)
a reciprocal;
(i)
a syndicate; or
(j)
another similar entity or combination of entities acting in concert. See Utah Code 31A-1-301
producer: means a person licensed or required to be licensed under the laws of this state to sell, solicit, or negotiate insurance. See Utah Code 31A-1-301
State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
A person authorized to engage in insurance activities in this state shall prominently disclose in writing the information described in Subsection (1)(b) to a person seeking an extension of credit if:
(i)
the person authorized to engage in insurance activities also extends credit directly or through a subsidiary or an affiliate;
(ii)
the person requires a customer to obtain insurance in connection with an extension of credit; and
(iii)
the person offers to the person seeking an extension of credit the line of credit insurance required in connection with the extension of credit.
(b)
The disclosure required by Subsection (1)(a) shall be in a form substantially similar to the following. “You may obtain insurance required in connection with your extension of credit from any insurance producer or approved insurer that sells such insurance. Your choice of insurance provider will not affect our credit decision or your credit terms.”
(c)
The person shall make the required disclosure under Subsection (1)(a):
(i)
at the time of written application for an extension of credit; or
(ii)
if there is no written application, before the closing of the extension of credit.
(2)
The disclosure required by Subsection (1)(c)(ii) may be in a verbal, electronic, or other unwritten form if a printed disclosure is included with the first printed statement of terms and conditions of the extension of credit sent to the person seeking the extension of credit.
(3)
This section does not apply when:
(a)
a person is contacting a person in the course of direct or mass marketing to a group of persons in a manner that bears no relation to the person’s application for an extension of credit or credit decision; and
(b)
an agreement for the extension of credit is changed or extended, if the person who originally sought the extension of credit is not required to purchase new or additional insurance.
(4)
(a)
For purposes of this section, “approved insurer” means an insurer that is approved to issue insurance related to the extension of credit by the person that extends the credit.
(b)
The commissioner shall make rules establishing standards that govern the approval under Subsection (4)(a) of an insurer by a person that extends credit.
Renumbered and Amended by Chapter 298, 2003 General Session
