§ 37-4-107. Maximum charge by creditor for insurance.
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§ 37-4-107. Maximum charge by creditor for insurance.
(1)Except as provided in subsection (2), if a creditor contracts for or receives a separate charge for insurance, the amount charged to the debtor for the insurance may not exceed the premium to be charged by the insurer, as computed at the time the charge to the debtor is determined, conforming to any rate filings required by law and made by the insurer with the Director of the Department of Insurance.
(2)A creditor who provides consumer credit insurance in relation to a revolving charge account (Section 37-2-108) or revolving loan account (Section 37-3-108) may calculate the charge to the debtor in each billing cycle by applying the current premium rate to
(a)the average daily unpaid balance of the debt in the cycle;
(b)the unpaid balance of the debt or a median amount within a specified range of unpaid balances of debt on approximately the same day of the cycle. The day of the cycle need not be the day used in calculating the credit service charge (Section 37-2-207) or loan finance charge (Section 37-3-201, Section 37-3-508 and Section 37-3-515), but the specified range shall be the range used for that purpose; or
(c)the unpaid balances of principal calculated according to the actuarial method.