2023 Laws of Puerto Rico › TITLE TWENTY-SIX - Insurance (§§ 101 — 10377) › Subtitle 1 - Insurance Generally (§§ 101 — 4513) › Chapter 18 - Consumer Credit Insurance (§§ 1801-1812 — 1823) › § 1819 - Disclosure to debtors and provisions of insurance policies and certificates

(1) Before a debtor chooses to purchase consumer credit insurance, with regard to a credit transaction, the insurer who provides this insurance shall furnish the following information, in writing, to the debtor:
(a) That the purchase of consumer credit insurance is optional and not a condition to obtain approval of credit.
(b) If more than one kind of consumer credit insurance is being offered to the consumer, whether the debtor can purchase separate coverage or only as a package.
(c) Eligibility conditions.
(d) That if the consumer has another policy that covers the risk, it is possible that he/she will not need the insurance that is being offered.
(e) That, within thirty (30) days after receiving the individual policy or the group insurance certificate, the debtor may cancel the coverage, and be entitled to receive reimbursement or full credit for the total unearned premium. After said term has elapsed, the debtor may cancel the policy or certificate at any time during the term of the credit transaction and receive full reimbursement or credit for the total unearned premium.
(f) A brief description of the coverage, including a description of the quality, term, any exception, limitation or exclusion, the insured event, any waiting period or exclusion period, any deductible, any applicable provision for a release from the payment of premiums, to whom the benefits shall be paid, and the premium rate that applies to each coverage or to all the coverages if it is a joint coverage policy.
(g) If the premium is financed in the credit transaction, it shall be subject to [finance] charges equal to those that apply to said transaction.
(2) The disclosure required by subsection (1) of this section shall be provided by the insurer involved as follows:
(a) With regard to consumer credit insurance offered concurrently with the extension of credit or offered through direct correspondence, the disclosure shall be made clearly and conspicuously, in writing.
(b) With regard to consumer credit insurance offered subsequently to the extension of credit or which is not offered through direct correspondence, the disclosure may be verbal; provided, that the written disclosure is provided to the debtor by the insurer no later than ten (10) days after the offer, or on the date on which any other written information is provided to the debtor, whichever of the two dates occurs first.
(3) All consumer credit insurance shall be evidenced by an individual policy or a group insurance certificate, which shall be remitted to the debtor.
(4) The individual policy or group insurance certificate shall include the following, in addition to any other provisions required by law:
(a) The name and address of the insurer’s home office.
(b) The name or names of the debtor or debtors.
(c) The premium that the debtor shall pay for each kind of coverage, separately, or for every coverage if it is a joint coverage policy, except that in the case of rotating credit accounts and credit card plans, the type and base rate shall be specified.
(d) A full description of the coverage or coverages including the amount and term thereof as well as any exception, limitation or exclusion.
(e) A statement to the effect that benefits will be paid to the creditor to reduce or extinguish the unpaid debt and that when the amount of the insurance benefit exceeds said debt, any excess shall be paid to a beneficiary who is not the creditor appointed by the debtor, or to the debtor’s estate.
(f) If the term of the insurance is less than the term of the credit transaction, a statement to such effect on the cover of the individual policy, or the group insurance certificate written in boldface of a size that is not less than ten (10) points.
(5) If the individual policy or the group insurance certificate is not given to the debtor upon incurring the debt, or at any other time which the debtor chooses to buy insurance coverage, then a copy of the application for the policy and a notice of the proposed insurance signed by the debtor shall be given to the latter at that time, which shall establish the following:
(a) Name and address of the insurer’s home office.
(b) Name or names of the debtor or debtors.
(c) Premium rate or the amount that the debtor shall pay for the insurance.
(d) Amount or term of the insurance.
(e) A brief description of the coverage provided.
The copy of the application or notice of the proposed insurance shall refer exclusively to the insurance coverage and shall be separate and distinct from any other document related to the credit transaction. Upon acceptance of the application by the insurer and within thirty (30) days from the date the debt is incurred or the purchase of insurance coverage is chosen, the insurer shall have the individual policy or group insurance certificate sent to the debtor. The application or notice of the proposed insurance shall establish that if it is accepted by the insurer the insurance shall be effective as provided in § 1818 of this title.
(6) The application, the notice of the proposed insurance, or the insurance certificate may be used to meet all the requirements of subsections (1) and (4) of this section, provided they contain all the information required therein.
(7) The debtor shall have thirty (30) days from the date he/she receives the individual policy or the group insurance certificate to review the coverage purchased. The debtor, at any time during said period can communicate with the creditor or the corresponding insurer and request that the coverage be cancelled. The individual policy or group insurance certificate may require that the petition for cancellation be made in writing or that the policy or certificate be returned, or both actions.
(8) If the risk is not accepted, all premiums paid shall be returned or credited to the person entitled thereto within thirty (30) days subsequent to the application for insurance.
(9) For the purposes of subsection (5) of this section, an individual policy or group insurance certificate that is sent together with a rotating account and credit card plan, or any consumer credit insurance requested by the debtor subsequent to the effectiveness of the debt, shall be understood to have been delivered at the time the debt was incurred, or at the time the debtor chose to purchase the insurance, if the delivery occurs within thirty (30) days from the effectiveness of the policy.
(10) Any individual policy or group insurance certificate that is delivered together with the rotating account and credit card plan shall continue in effect from its effective date while said rotating account and credit card plan persists, unless the individual policy or group insurance certificate is terminated according to its terms, on a prior date.
History —Ins. Code, added as § 18.080 on Jan. 9, 1999, No. 15, § 2; Feb. 25, 2008, No. 19, § 4, eff. 90 days after Feb. 25, 2008.