California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 4.10 - Rates for Credit Property Insurance and Credit Unemployment Insurance › Article 5 - Benchmark Provisions for Credit Unemployment Insurance › Section 2670.19 - Benchmark Number Eight: Provisions for 30-Day Retroactive Credit Unemployment Insurance on an Installment Loan Plan of Indebtedness, Paying Monthly Payment on Installment Loan up to Twelve Monthly Payments

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) When Coverage Is In Effect. Coverage is
				  in effect for the term of years set forth in the certificate of insurance, from
				  12:01 a.m. on the effective date of coverage to 12:01 a.m. on the expiration
				  date of coverage.
(b) Coverage
				  Provided. The insurer will pay loss payment benefits to the master policyholder
				  for the benefit of the certificate holder's account on a loan agreement or
				  sales contract between the certificate holder and the master policyholder. The
				  loan agreement or sales contract must provide for equal monthly installment
				  payments or loans with a variable interest feature, or loans with a balloon
				  payment. For loans with a variable interest rate of loans with a balloon
				  payment the monthly benefit will not exceed the original monthly payment
				  amount. The balloon payment is not covered. The insurer will pay the
				  certificate holder's scheduled monthly payment on the loan agreement or sales
				  contract if the certificate holder is involuntarily unemployed for at least 30
				  consecutive days. After the 30-day waiting period the insurer will pay the
				  scheduled monthly payment retroactively to the first day of unemployment and
				  while the unemployment continues. The scheduled monthly payment on the
				  certificate holder's indebtedness must be at least 30 days delinquent for
				  coverage to begin.
(c) Perils
				  Insured. The insurer will pay benefits for loss of the certificate holder's
				  employment income resulting from involuntary loss of employment, or
				  unemployment due to labor disputes, strikes, or lockouts.
(d) Exclusions. Coverage does not apply to
				  voluntary forfeiture of salary, wages, or employment income; resignation;
				  retirement whether voluntary or mandatory; disability caused by accident,
				  sickness, disease or pregnancy; or termination as the result of willful
				  misconduct or criminal misconduct.
(e) Limit of Liability. The insurer will pay
				  the scheduled monthly benefit or an amount equal to 1/30th of the scheduled
				  monthly benefit for each day of a period less than thirty days which the
				  certificate holder are involuntarily unemployed. The insurer will go back to
				  the first day of the certificate holder's eligibility to count the number of
				  days. The total of all payments is limited to the schedule shown in the table
				  below. If the certificate holder's loss of employment occurs during the first
				  60 days after inception of coverage the maximum number of payment benefits
				  payable during that period of involuntary unemployment will be one-half of the
				  total benefits payable as provided in the schedule.
The maximum number of monthly benefits provided shall not
					 exceed the remaining originally scheduled total of loan payments at the time of
					 loss. In the event that the certificate holder's loan or credit agreement is
					 extended or modified in any manner, the insurer's liability will never be more
					 that the total amount of monthly benefits that would have been provided without
					 such modification or extension.
Term of Loss
Maximum Benefits Payable for Loss After 60
								Days
Maximum Number of Benefits Payable for Loss
								Within the 1st 60 days
1-13 months
4
2
14-19 months
5
2.5
20-25 months
6
3
26-31 months
7
3.5
32-37 months
8
4
38-43 months
9
4.5
44-49 months
10
5
50-55 months
11
5.5
56-61 months
12
6
No more that the total monthly benefits shown above will be
					 payable during the term of coverage. It will include all amounts paid for
					 involuntary unemployment, whether during one or more periods of
					 unemployment.
(f)
				  Eligibility
To be eligible for loss of employment income benefits, as
					 of the effective date of the certificate the certificate holder must be
					 gainfully employed for at least 12 consecutive months except for vacation time,
					 prior to the effective date of this coverage, except employment interruption
					 for less than 30 consecutive days during the previous 12 month period or
					 employment interrupted by lockout, general strike, or unionized labor dispute
					 shall not eliminate a certificate holder from eligibility. Self-employed
					 individuals or independent contractors or seasonal employees are not eligible
					 for coverage. To receive loss of income benefits, the certificate holder must
					 qualify for unemployment benefits under the certificate holder's state's
					 unemployment laws and must register for work with the certificate holder's
					 state employment office or a recognized employment agency within 15 days after
					 the last day employed and remain so registered during the claim period if the
					 loss of employment occurred as the result of either layoff or employer
					 termination; or provide the insurer with verification of loss which occurred as
					 the result of a general strike, unionized labor dispute or lockout from sources
					 as determined by the insurer at the time of loss. Coverage will not be denied
					 if the certificate holder does not qualify for state unemployment benefits
					 because the certificate holder's former employer was not required to contribute
					 to the state unemployment fund. Re-eligibility for remaining benefits will
					 begin on the 1st day of unemployment if the employment period is less than 30
					 days. If the unemployment period is greater than 30 days, eligibility for
					 payment will begin after the 30th day of unemployment.
1. New
					 section filed 3-10-2003; operative 4-9-2003. Submitted to OAL for printing only
					 pursuant to Government Code section
					 11343.8 as
					 a regulation that establishes rates in accordance with Government Code section
					 11340.9(g)
					 (Register 2003, No. 11).
2. Change without regulatory effect
					 withdrawing and repealing section pursuant to settlement agreement in Consumer
					 Credit Insurance Association v. John Garamendi (California Superior Court No.
					 03CS00533) filed 5-27-2004 pursuant to section
					 100, title 1, California Code of
					 Regulations (Register 2004, No. 22).
3. New section filed 4-28-2006;
					 operative 5-28-2006. Submitted to OAL for printing only pursuant to Government
					 Code section
					 11343.8 as
					 a regulation that establishes rates in accordance with Government Code section
					 11340.9(g)
					 (Register 2006, No. 17).
4. Change without regulatory effect
					 amending subsection (f) filed 7-14-2021 pursuant to section
					 100, title 1, California Code of
					 Regulations (Register 2021, No. 29). Filing deadline specified in Government
					 Code section
					 11349.3(a)
					 extended 60 calendar days pursuant to Executive Order
					 N-40-20.
Note: Authority cited: Sections
						779.21,
						779.36,
						12921 and
						12926,
						Insurance Code; Credit Insurance General Agents Association v. Payne, 16 Cal.3d
						651 (1976); and 20th Century v. Garamendi, 8 Cal.4th 216 (1994). Reference:
						Sections
						779.36,
						1861.01 and
						1861.05,
						Insurance Code.