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California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.1 - Table of Contents

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
2248.
				  Preamble and Authority
2248.1. Table of
				  Contents.
2248.2. Effective
				  Date.
2248.3.
				  Definitions.
2248.4.
				  Premiums.
2248.5. Claims and Claim
				  Review Procedure.
2248.6.
				  Responsibility of Insurers, Life and Disability Insurance Agents and Insurance
				  Agents to Make Review of Transactions.
2248.7. Provisions of Policies and
				  Certificates of Insurance: Disclosure to Debtors.
2248.8. Refund Formula.
2248.9. Premium Rates.
2248.10. Rate Deviations.
2248.11. Compensation.
2248.12. Compensating Balances or Special
				  Deposits Prohibited.
2248.13.
				  Reinsurance Through Non-Admitted Insurers.
2248.14. Minimum Financial Statement
				  Reserves.
2248.15. Annual
				  Experience Statistics Reporting.
2248.16. Department of Insurance Form Credit
				  Rate Certification Form CRC.
2248.17. Annual Experience Report
				  Forms.
2248.18. Deviated date
				  Calculation Form CDEV.
2248.19.
				  Disabled Lives Reserve Development Form CDK.
2248.10. Rate Deviations.
2248.11. Compensation.
2248.12. Compensating Balances or Special
				  Deposits Prohibited.
2248.13.
				  Reinsurance Through Non-Admitted Insurers.
2248.14. Minimum Financial Statement
				  Reserves.
2248.15. Annual
				  Experience Statistics Reporting.
2248.16. Department of Insurance Form Credit
				  Rate Certification Form CRC.
2248.17. Annual Experience Report
				  Forms.
2248.18. Deviated date
				  Calculation Form CDEV.
2248.19.
				  Disabled Lives Reserve Development Form CDK.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.2 - Effective Date

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
This Ruling shall become effective on the first day of
					 April, 1979, and shall be applicable to all credit insurance individual
					 policies and certificates transacted thereafter. All Bulletins issued since
					 July 1, 1973 relating to Ruling No. 186 are hereby rescinded.
Note: Authority cited: Section
						779.21,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.3 - Definitions

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
As used in these regulations:
(a) "Credit life insurance," "credit
				  disability insurance creditor," "debtor" and "indebtedness" have the meanings
				  assigned to such terms in Section
				  779.2 of
				  the Insurance Code.
(b) "Credit
				  insurance" means both credit life insurance and credit disability
				  insurance.
(g) "Application" means
				  any document, including a conditional sales contract, which the debtor signs
				  and which requests credit insurance coverage the debtor, or which authorizes
				  the financing of credit insurance premium or agrees to pay credit insurance
				  premiums.
(h) "Actuary," as used in
				  these regulations, means an actuary who is:
(1) a member of the American Academy of
				  Actuaries, or of the Society of Actuaries or
(2) a person who has engaged in the practice
				  of actuarial science and has demonstrated by his training and experience
				  actuarial competence to the satisfaction of the
				  Commissioner.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.4 - Premiums

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) The amount
				  charged to a debtor for any credit life or credit disability insurance shall
				  not exceed the premium rates filed with the Commissioner for the coverage
				  provided or the premiums charged by the insurer, as computed at the time the
				  charge to the debtor is determined, whichever is less.
(b) If the creditor adds identifiable
				  insurance charges or premiums for credit insurance to the total amount of the
				  indebtedness and makes any direct or indirect finance, carrying, credit or
				  service charge whatever to the debtor in connection with such insurance charge,
				  the creditor is deemed to have loaned the premium or insurance charge to the
				  debtor and the premium or insurance charge is deemed collected for the insurer
				  as soon as it is added to the indebtedness, in which event, the creditor must
				  remit and the insurer shall collect on a single premium basis only.
(c) A creditor may remit and an insurer may
				  collect premiums on the monthly balance basis on revolving credit
				  accounts.
(d) A creditor may remit
				  and an insurer may collect premiums on the monthly balance basis on
				  indebtedness repayable during a fixed period (non-revolving accounts) for both
				  credit life insurance and credit disability insurance.
(e) When premiums are remitted on the monthly
				  balance basis, either on a revolving account or a fixed indebtedness period
				  basis, the charge for the premium shall be shown separately from the balance of
				  the loan and any payment received by the creditor shall first be applied to pay
				  the credit insurance premium. Only in the event no payment is made or the
				  payment made is insufficient to satisfy the premium charge, may the creditor
				  add the unpaid premium to the loan and remit it to the insurers.
1. Editorial
					 correction of subsection referenced in subsection (f) (Register 79, No.
					 2).
2. Repealer of subsections (f)-(g) and amendment of NOTE filed
					 4-14-94; operative 5-16-94. Submitted to OAL for printing only pursuant to
					 Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
3. Amendment of subsection (c) filed
					 10-2-2006; operative 11-1-2006 (Register 2006, No.
					 40).
Note: Authority cited: Section
						779.21,
						California Insurance Code. Reference: Sections
						779.21 and
						779.13,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.5 - Claims and Claims Review Procedure

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) The insurer shall be responsible for the
				  settlement, adjustment and payment of all claims and shall establish and
				  maintain adequate claim files, which may be reviewed and examined by the
				  Commissioner. All claims shall be promptly reported to the insurer, or its
				  designated claim representative, and all claims shall be settled as soon as
				  possible in accordance with the terms of the insurance contract.
(b) All claims shall be paid, either by draft
				  drawn upon the insurer or by check of the insurer, directly to the order of the
				  claimant to whom payment of the claim is due under the policy, or to the payee
				  specified by such claimant. If the insurance payable exceeds the balance which
				  the debtor or his estate are obligated to pay to the creditor, the insurer
				  shall pay the excess directly to the person or estate entitled to such excess,
				  or establish procedures to be followed the creditor or make such payments, in
				  which case the insurer must take all reasonable precautions to make certain
				  such procedures are followed.
(c)
				  No person, firm or corporation other than the insurer or its designated claim
				  representative shall be authorized to settle or adjust claims. Neither the
				  creditor nor the general agent or agent of the insurer shall be designated
				  claim representative for the insurer in settling or adjusting claims. A group
				  policyholder, however, by arrangement with the insurer, may draw drafts or
				  checks in payment of claims due to the group policyholder subject to audit and
				  review by the insurer.
Note: Authority cited: Section
						779.21,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.6 - Responsibility of Insurers, Life and Disability Insurance Agents and Insurance Agents to Make Review of Transactions

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) It shall.be the responsibility of the
				  insurer, all creditors licensed as life and disability insurance agents and
				  insurance agents who receive commissions on credit insurance in connection with
				  the transaction of credit insurance to conduct a review of each creditor
				  account within 120 days after the end of the first year and thereafter a
				  minimum of once each two years for the purpose of assuring compliance with
				  these regulations and all applicable provisions of the Insurance Code,
				  including the calculation of the proper premium and the transmittal of the
				  proper premium to the insurer, and payment of claims and refunds, and make any
				  necessary corrections to comply with the provisions of these
				  regulations.
Note: Authority cited: Section
						779.21,
						California Insurance Code. 14 Day Retroactive Plan
						$2.55
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.7 - Provisions of Policies and Certificates of Insurance: Disclosure to Debtors

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) An individual
				  credit insurance policy or a certificate of group credit insurance shall be
				  delivered to the debtor within thirty (30) days after the debtor becomes
				  insured in connection with the indebtedness, as evidence of such
				  insurance.
(b) Each individual
				  policy or group certificate of credit insurance delivered or issued for
				  delivery in this State shall, in addition to the other requirements of law, set
				  forth:
(1) the name and home office address
				  of the insurer, and, on group certificates, an identification of the master
				  policy;
(2) the identity of the
				  insured debtor by name or any other reasonable alternative method of
				  identification approved by the Commissioner;
(3) the full amount of premium or
				  identifiable insurance charge to the debtor, separately for the credit life
				  insurance and credit disability insurance; except that in lieu of so stating
				  the full amount of premium or identifiable insurance charge, there may be set
				  forth, separately for credit life insurance and credit disability insurance,
				  the rate of insurance premium or payment per unit of coverage in case the
				  indebtedness is a revolving loan or charge account or in cases where the debtor
				  obligates himself to pay the insurance premium or payment periodically with the
				  debt payments on the decreasing amount of the insurance;
(4) a description of the coverage including
				  the amount and term thereof;
(5)
				  any exceptions, reductions, limitations and restrictions;
(6) a statement that the benefits will be
				  paid to the creditor to reduce or extinguish the indebtedness, and if the
				  policy provides coverage which may exceed the amount to which the creditor is
				  entitled under the contract of indebtedness, any such excess shall be paid to a
				  beneficiary other than the creditor, named by the debtor or to his estate;
				  and
(7) a statement that in the
				  event the indebtedness is discharged due to renewal or refinancing prior to the
				  scheduled maturity date, the insurance in force shall be terminated before any
				  new insurance may be issued in connection with the renewed or refinanced
				  indebtedness, and in the event the indebtedness is discharged due to payment
				  prior to the scheduled maturity date, the insurance in force shall be
				  terminated, unless payments are made to the debtor during the period of
				  disability under the provisions of Section
				  2248.7(c)(2)(E).
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.8 - Refund Formula. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Editorial
					 correction of subsection designations (Register 79, No. 2).
2.
					 Repealer filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only
					 pursuant to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Section
						779.21,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.9 - Premium Rates. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Amendment
					 file 1-12-79; designated effective 4-1-79 (Register 79, No. 2).
2.
					 Editorial correction of subsection designations (Register 79, No.
					 2).
3. Amendment filed 6-4-79; effective thirtieth day thereafter
					 (Register 79, No. 23).
4. Repealer filed 4-14-94; operative 5-16-94.
					 Submitted to OAL for printing only pursuant to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Section
						779.21,
						California Insurance Code. Reference: Section
						779.9,
						Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.10 - Rate Deviations. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Amendment
					 of subsections (b)(3)(B)2.b., (c)(1)(A) and (c)(1)(G) filed 1-12-79; designated
					 effective 4-1-79 (Register 79, No, 2).
2. Editorial correction of
					 subsection designations (Register 79, No. 2).
3. Amendment filed
					 6-4-79; effective thirtieth day thereafter (Register 79, No. 23).
4.
					 Repealer filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only
					 pursuant to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Section
						779.21,
						California Insurance Code. Reference: Section
						779.9,
						Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.11 - Compensation. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Amendment
					 filed 1-12-79; designated effective 4-1-79 (Register 79, No. 2).
2.
					 Amendment filed 6-9-79; effective thirtieth day thereafter (Register 79, No.
					 23).
3. Repealer filed 10-2-2006; operative 11-1-2006 (Register
					 2006, No. 40).
Note: Authority cited: section
						779.21,
						California Insurance Code. Reference: Section
						779.9,
						Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.12 - Compensating Balances or Special Deposits Prohibited. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Editorial
					 correction of subsection designations (Register 79, No. 2).
2.
					 Repealer filed 10-2-2006; operative 11-1-2006 (Register 2006, No.
					 40).
Note: Authority cited: Section
						779.21,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.13 - Reinsurance Through Non-Admitted Insurers

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) In the matter of reinsurance ceded to a
				  non-admitted insurer, attention of all insurers writing credit insurance in
				  this State is directed to the provisions of Sections
				  922.4 and
				  922.5 of
				  the Insurance Code. These sections will be strictly enforced by the
				  Commissioner. As a practical matter, an insurer will normally qualify for any
				  reserve credits by satisfying the requirements of 922.4 (b), 922.5 (a) or 922.5
				  (c) of the Insurance Code.
(b) The
				  Commissioner may require a detailed accounting of deposits to, withdrawals
				  from, and balances of, or may at any time examine, any or all deposits or funds
				  held by or for the admitted insurer as the basis for such claim of reinsurance
				  credit.
Note: Authority cited: Section
						779.21,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.14 - Minimum Statement Reserves

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Definitions.
(1) The "2001 CSO Male Composite Ultimate
				  Mortality Table" is a table that is part of the "2001 CSO Mortality Table." The
				  "2001 CSO Mortality Table" means that mortality table, consisting of separate
				  rates of mortality for male and female lives, developed by the American Academy
				  of Actuaries CSO Task Force from the Valuation Basic Mortality Table developed
				  by the Society of Actuaries Individual Life Insurance Valuation Mortality Task
				  Force, and adopted by the NAIC in December 2002. The 2001 CSO Mortality Table
				  is included in the
Proceedings of the NAIC
(2nd Quarter 2002).
				  Unless the context indicates otherwise, the "2001 CSO Mortality Table" includes
				  both the ultimate form of that table and the select and ultimate form of that
				  table and includes both the smoker and nonsmoker mortality tables and the
				  composite mortality tables. It also includes both the age-nearest-birthday and
				  age-last-birthday bases of the mortality tables. The 2001 CSO Mortality Table
				  is incorporated by reference herein.
(2) The "1985 Commissioners Individual
				  Disability Table A," also called the "Basic Valuation Table" or "85CIDA," is
				  set forth in
Transactions of the Society of Actuaries
(1986),
				  Volume XXXVII, at pages 449-460. The "1985 Commissioners Individual Disability
				  Table A" is incorporated by reference herein.
(3) "Policy" means an individual insurance
				  policy or group insurance certificate.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.15 - Annual Experience Statistics Reporting. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Repealer
					 filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only pursuant
					 to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Section
						779.21,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.16 - Department of Insurance Form. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Repealer
					 filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only pursuant
					 to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Section
						779.21,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.17 - Annual Experience Report Forms. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Repealer
					 filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only pursuant
					 to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Section
						779.21,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.18 - Deviated Rate Calculation Form CDEV. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Repealer
					 filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only pursuant
					 to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Section
						779.21,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.19 - Disabled Lives Reserve Development Form CDP. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Repealer
					 filed 10-2-2006; operative 11-1-2006 (Register 2006, No.
					 40).
Note: Authority cited: Section
						779.21,
						California Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.7 - Credit Life and Credit Disability Insurance Policy Forms and Administration › Section 2248.20 - Rate Tables and Reporting Forms. [Repealed]

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
1. Amendment
					 of form CDEV filed 6-4-79; effective thirtieth day thereafter (Register 79, No.
					 23).
2. Repealer filed 4-14-94; operative 5-16-94. Submitted to OAL
					 for printing only pursuant to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Section
						779.21,
						California Insurance Code. Reference: Section
						779.9,
						Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.30 - Table of Contents

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
2248.31.
Definitions.
2248.32.
Presumptive Loss Ratios and Prima
							 Facie Rates, Generally.
2248.33.
Classes of Business.
2248.34.
Prima Facie Premium Computation for
							 Life Coverages.
2248.35.
Prima Facie Premium Computation for
							 Disability Coverages.
2248.36.
Agricultural and Horticultural
							 Loans.
2248.37.
Rates by Age.
2248.38.
Life and Disability Premium
							 Refunds.
2248.39.
Test for Deviated Rates.
2248.40.
Calculation of the New Case
							 Rate.
2248.41.
Application of Downward Deviated
							 Rates.
2248.42.
Approval and Use of Upward Deviated
							 Rates.
2248.43.
Reduced and Actuarially Equivalent
							 Rates and Refund Formulas.
2248.44.
Annual Experience Reports.
2248.45.
Effective Date.
2248.46.
Severability.
2248.47.
Tables.
1. New
					 article 6.8 and section filed 4-14-94; operative 5-16-94. Submitted to OAL for
					 printing only pursuant to Government Code section
					 11343(a)(1)
					 Register 94, No. 15).
2. Amendment deleting reference to repealed
					 section 2248.48 filed 10-2-2001; operative
					 10-1-2001. Submitted to OAL for printing only pursuant to Government Code
					 section
					 11340.9(g)
					 (Register 2001, No. 40).
Note: Authority cited: Sections
						779.21 and
						779.36,
						Insurance Code. Reference: Section
						779.36,
						Insurance Code.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.32 - Presumptive Loss Ratios and Prima Facie Rates, Generally

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) The Presumptive Loss Ratios (PLRs) for
				  credit life insurance coverage and for credit disability insurance coverage
				  shall be those indicated below. For the purpose of Insurance Code §
										779.9 it
				  shall be presumed that benefits provided in a policy or certificate are not
				  reasonable in relation to the premium charge if the claims incurred thereunder
				  cannot be reasonably expected to equal the PLR below of the premiums earned
				  separately thereunder for credit life insurance or for credit disability
				  insurance.
The PLRs are shown in the table below:
Credit Life
								Insurance
Class
Single life
Joint life
Closed End
A-E
54.47%
54.24%
Open End Line of Credit
A,B,D,E
54.71%
54.31%
Credit Card
A,B,D,E
54.71%
54.31%
Credit Union Open End
C
54.60%
54.35%
Credit Union Credit Card
C
54.60%
54.35%
Credit disability Insurance
A
58.73%
73.41%
B
56.34%
70.43%
C
59.13%
73.91%
D
59.64%
74.58%
E
54.91%
68.64%
Note the PLR can be expressed as 56.34% or .5634 when used
					 in a formula.
(b) The prima
				  facie rates set forth in these regulations:
(1) Assume that identical coverage (including
				  maximum amounts and terms of coverage) is offered or provided to all debtors of
				  age 65 or less, and Open-end coverages typically terminate at age 65;
(2) Assume that coverages are subject to the
				  limitations and eligibility standards established for standard policy forms in
				  Article 6.9 of this Subchapter.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.34 - Prima Facie Premium Computation for Life Coverages

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Prima facie premiums for Closed End life
				  coverages ("Scheduled Decreasing Life", "Class A Decreasing Life" and "Level
				  Life") are computed as follows:
(1) Single
				  premium single life:
Click
					 here to view image
Where: n = number of months of coverage
t varies from 1 to n
(This formula calculates the present value of monthly
					 premiums for each month of the term of the loan. The present values are then
					 accumulated to determine the single premium.)
(2) Monthly premium single life:
Monthly Premium = MP X
Inst
1000
Where:
MP is the Closed End Monthly Premium per $1000 of
								scheduled outstanding balance of the indebtedness from TABLE 1 in §
																2248.47.
Inst is the lesser of
								the scheduled principal balance of the debt outstanding for month "t" (not
								including delinquencies or unearned finance charges) or the amount of insurance
								for month t (for partial coverage).
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.35 - Prima Facie Premium Computation for Disability Coverages

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Single and monthly premiums for single
				  disability coverage of Closed End loans, where coverage extends for a period
				  measured from the inception of coverage, are computed as follows:
SP (for the term of coverage) x (Total of covered
								disability benefit payments)
Single Premium
=
__________________________________________________________
$1000
MP (for the initial term of coverage) x (Scheduled
								total of covered disability benefit payments remaining on Month
								"t")
Monthly Premium for Month "t"
=
__________________________________________________________
$1000
Where SP and MP are taken from the lettered Subtable,
					 corresponding to the Class of Business, of TABLE 2 in §
											2248.47.
(b) Prima facie monthly premiums for single
				  Open End disability coverages ("Credit Union Open End", "Line of Credit" and
				  "Credit Card") are computed as follows:
Monthly Premium = MP X
Inst
$1000
Where:
MP is the Open End Monthly Premium per $1000 of
								outstanding principal balance (not including unearned finance charges) from
								TABLE 3 in §
															2248.47.
Ins 
								t is the outstanding
								principal balance of the debt outstanding for month "t" (not including unearned
								finance charges) or the amount for month t provided for in the policy or
								certificate, if less.
The balance to which the rate is applied may be computed on
					 the same basis as that used to compute interest charges on the
					 debt.
(c) Prima facie
				  premium rates for "Critical Period Disability" coverage, as provided for in
				  Article 6.7, shall be actuarially equivalent to the prima facie disability
				  rates for the corresponding coverage under subsections (a) and (b) and shall be
				  approved by the Commissioner pursuant to §
										2248.43.
(d) Prima facie rates for "Joint Disability"
				  coverages are computed by multiplying the appropriate single disability rates
				  by 1.6.
1. New
					 section filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only
					 pursuant to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
2. Amendment of subsection (b) filed
					 1-9-2002; operative 1-9-2002. Submitted to OAL for printing only pursuant to
					 Government Code section
					 11340.9(g)
					 (Register 2002,, No. 2).
Note: Authority cited: Sections
						779.21 and
						779.36,
						Insurance Code. Reference: Sections
						779.9,
						779.13,
						779.16 and
						779.36,
						Insurance Code; Sections
						18191,
						18290 -
						18292,
						22458.1,
						22458.2,
						24458.1 and
						24458.2,
						Financial Code; and Credit Insurance General Agents Association v. Payne,
						(1976) 16 Cal.3d 651.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.36 - Agricultural and Horticultural Loans

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Rates for coverage on agricultural and
				  horticultural loan commitments as defined in Ins. C. §
										10203.35 shall be deemed not
				  reasonable in relation to the benefits provided if they fail to attain the
				  presumptive loss ratios established by §
										2248.32(a) based
				  upon experience developed in the preceding 3 years. Such experience may be
				  adjusted for credibility using the Credibility Table in §
										2248.40(b). Such
				  rates shall be filed with the Commissioner annually, along with loss experience
				  for the preceding three years, regardless of whether such rates have been
				  adjusted for the year of filing.
(b) Section
				  2248.32, except for Subsection
				  (a), and §§
										2248.34,
				  2248.35,
				  2248.37 and
				  2248.39 through
				  2248.42 do not apply to insurance
				  covering agricultural and horticultural loan commitments as defined in Ins. C.
				  §
										10203.55.
1. New
					 section filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only
					 pursuant to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Sections
						779.21 and
						779.36,
						Insurance Code. Reference: Sections
						779.9,
						779.13,
						779.16,
						10203.5 and
						10203.55,
						Insurance Code; and Credit Insurance General Agents Association v. Payne,
						(1976) 16 Cal.3d 651.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.37 - Rates by Age

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
Age-banded rates may be used upon the Commissioner's
					 approval. The Commissioner shall not approve such rates unless:
(a) They are actuarially equivalent to the
				  prima facie rates established by this Article based upon demonstrated mortality
				  or morbidity rates for each age band and the margins for insurer expenses and
				  profit assumed in the prima facie rates;
(b) They would produce an aggregate premium
				  which would not substantially exceed that which would be produced by the prima
				  facie rates, assuming a normal distribution of debtors by age within the
				  experience group for the Class of Business.
1. New
					 section filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only
					 pursuant to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Sections
						779.21 and
						779.36,
						Insurance Code. Reference Sections
						779.9,
						779.13,
						779.16 and
						779.36,
						Insurance Code; Sections
						18191,
						18290 -
						18292,
						22458.1,
						22458.2,
						24458.1,
						24458.2,
						Financial Code; and Credit Insurance General Agents Association v. Payne,
						(1976) 16 Cal.3d 651.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.38 - Life and Disability Premium Refunds

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Refunds of single premiums pursuant to
				  Insurance Code §
										779.14
				  shall not be less than amounts calculated as follows:
(1) For life insurance, the single premium
				  for the scheduled remaining insured amount and term of coverage.
(2) For disability insurance:
Refund
=
Original Single Premium X (t/n)(SPt/SPn) -
								$10
Where:
t
=
the remaining term in months
n
=
the original term in months
SPt
=
the single premium per $1000 remaining insured
								amount
SPn
=
the original single premium per $1000 initial
								insured amount
(3)
				  Refunds of less than $5.00 per policy or certificate need not be made. If
				  insurance has terminated due to refinancing of the covered indebtedness and new
				  credit insurance is provided by the same insurer on the refinanced
				  indebtedness, the entire refund amount, including the minimum refund provided
				  for herein and the $10 retention provided for in paragraph (2) (if the
				  terminated indebtedness was insured for disability), shall be applied toward
				  the premium for the new credit insurance.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.39 - Test for Deviated Rates

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) An insurer shall use life insurance rates
				  and disability insurance rates lower than the prima facie rates for an
				  experience group if the credibility adjusted loss ratio for that group is equal
				  to or less than the Presumptive Loss Ratio (PLR) less .05.
(b) An insurer may use life insurance rates
				  and disability insurance rates higher than the prima facie rates for an
				  experience group when the credibility adjusted loss ratio for that group equals
				  or exceeds PLR + .05.
(c) For the
				  purpose of applying this Section to life insurance and disability insurance,
				  credibility adjusted loss ratios shall be computed according to §
										2248.40(c) for
				  the most recent experience period, based upon the applicable prima facie rates
				  for the experience group.
(d) Rates
				  which are lower or higher than the prima facie rates shall not exceed the new
				  case rates for the experience group computed according to §
										2248.40 and shall be administered
				  pursuant to §
										2248.41 or §
										2248.42, respectively. Rates shall
				  be calculated and applied separately for life and for disability.
1. New
					 section filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only
					 pursuant to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
2. Amendment of section and NOTE filed
					 10-2-2001; operative 10-1-2001. Submitted to OAL for printing only pursuant to
					 Government Code section
					 11340.9(g)
					 (Register 2001, No. 40).
Note: Authority cited: Sections
						779.21 and
						779.36,
						Insurance Code. Reference: Sections
						779.9,
						779.13,
						779.16 and
						779.36,
						Insurance Code; Sections
						18191,
						18290-
						18292,
						22314,
						22315 and
						22455,
						Financial Code; and Credit Insurance General Agents Association v. Payne,
						(1976) 16 Cal. 3d 651.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.41 - Application of Downward Deviated Rates

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) For life insurance and disability
				  insurance, an insurer shall submit, for the Commissioner's approval, proposed
				  downward deviated rates for an experience group subject to §
										2248.39(a) within
				  180 days after the end of an experience period during which the credibility
				  adjusted loss ratio for the group was equal to or less than PLR less
				  .05.
(b) Credibility adjusted loss
				  ratios using prima facie rates and new case rates shall be redetermined on each
				  anniversary of the effective date of downward deviated rates for an experience
				  group.
(1) For life insurance and disability
				  insurance, if the credibility adjusted loss ratio for the experience group as
				  of the time of redetermination equals at least PLR less .05, the insurer may
				  submit, for the Commissioner's approval, a proposal for termination of downward
				  deviated rates for the experience group.
(2) If the rates in effect as of such
				  redetermination exceed by 10% or more the new case rates, then the insurer
				  shall submit for the Commissioner's approval, proposed reduced rates which
				  shall not exceed the new case rates. This submission shall be made within 180
				  days of the date as of which the new case rates were determined.
(3) If the new case rates exceed the rates in
				  effect as of such redetermination, then the insurer may submit, for the
				  Commissioner's approval, increased rates not to exceed the new case
				  rates.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.42 - Approval and Use of Upward Deviated Rates

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) For life insurance and disability
				  insurance, an insurer may submit, for the Commissioner's approval, proposed
				  upward deviated rates for an experience group subject to §
										2248.39(b) after
				  the end of an experience period during which the credibility adjusted loss
				  ratio for the group equaled or exceeded PLR + .05.
(b) Credibility adjusted loss ratios using
				  prima facie rates and new case rates for an experience group subject to upward
				  deviated rates shall be redetermined as of each anniversary of the effective
				  date of such rates for the group.
(1) For
				  life insurance and disability insurance, if the credibility adjusted loss ratio
				  for the experience group as of the time of redetermination does not attain at
				  least PLR + .05, then the insurer shall terminate such upward deviated rates
				  within 180 days of the end of the experience period during which the
				  credibility adjusted loss ratio failed to attain PLR + .05.
Insurers shall notify the Commissioner of the termination
					 of upward deviated rates.
(2) If the rates in effect as of such
				  redetermination exceed by 10% or more the new case rates, then the insurer
				  shall submit, for the Commissioner's approval, proposed reduced rates which
				  shall not exceed the new case rates. This submission shall be made within 180
				  days of the date as of which the new case rates were determined.
(3) If the new case rates exceed the rates in
				  effect as of such redetermination by 10% or more, then the insurer may submit,
				  for the Commissioner's approval, increased rates not to exceed the new case
				  rates.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.43 - Reduced and Actuarially Equivalent Rates and Refund Formulas

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Rates lower
				  than the prima facie or downward deviated rates established by this Article
				  shall be filed with the Commissioner no later than 30 days after their
				  implementation.
(b) Rates which are
				  actuarially equivalent to the prima facie or deviated rates established or
				  allowed by this Article may be used upon the Commissioner's approval.
(c) Rates for coverage which do not qualify
				  for the use of prima facie rates pursuant to §
										2248.32(b) shall
				  not exceed the actuarial equivalents of the prima facie rates established by
				  this Article, and shall be approved by the Commissioner before their use. Such
				  rates shall be subject to §§
										2248.37 through
				  2248.42.
(d) Refund formulas which are actuarially
				  equivalent to, or more favorable to the insured than, the formulas established
				  by this Article may be used upon the Commissioner's approval.
(e) The Commissioner may publish, by
				  Bulletin, rates or refund formulas which he deems to be actuarially equivalent
				  to the prima facie rates. Such rates and formulas may be used without filing
				  with or approved by the Commissioner, but their use must be indicated on the
				  annual experience report forms.
1. New
					 section filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only
					 pursuant to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Sections
						779.21 and
						779.36,
						Insurance Code. Reference: Sections
						779.9,
						779.13,
						779.16 and
						779.36,
						Insurance Code; Sections
						18191,
						18290 -
						18292,
						22458.1,
						22458.2,
						24458.1 and
						24458.2,
						Financial Code; and Credit Insurance General Agents Association v. Payne,
						(1976) 16 Cal. 3d 651.
California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 2 - Policy Forms and Other Documents › Article 6.8 - Credit Life and Credit Disability Insurance: Premium Rates › Section 2248.44 - Annual Experience Reports

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Each insurer subject to this Article
				  shall file an annual report of its credit life and disability experience
				  statistics with the Commissioner. Such report shall be filed no later than May
				  1 of the year following the calendar year reported. Each type of insurance as
				  defined in this Article shall be reported separately on Credit Life and
				  Disability Insurance Experience Report Forms prescribed by the Commissioner.
				  Experience reports for insurance plans not defined in this Article shall
				  include brief descriptions of the coverages provided. The Commissioner reserves
				  the right to require that reports be filed in electronic media form. Each
				  insurer shall maintain experience data on an annual basis for its business
				  subject to this Article or to Article 6.7 of this Subchapter prior to the
				  effective date of this Article, for at least five years.
(b) Experience statistics generated under
				  conditions different from those assumed in §
										2248.32(b),
				  including eligibility and termination ages different than those assumed in
				  Article 6.9, shall be reported separately.
(c) Credit insurance experience generated by
				  business issued before the effective date of this Article shall be maintained
				  and reported separately from experience generated under this Article.
1. New
					 section filed 4-14-94; operative 5-16-94. Submitted to OAL for printing only
					 pursuant to Government Code section
					 11343(a)(1)
					 (Register 94, No. 15).
Note: Authority cited: Sections
						779.21 and
						779.36,
						Insurance Code. Reference: Sections
						779.9,
						779.13,
						779.16 and
						779.36,
						Insurance Code; Sections
						18191,
						18290 -
						18292,
						22458.1,
						22458.2,
						24458.1 and
						24458.2,
						Financial Code; and Credit Insurance General Agents Association v. Payne,
						(1976) 16 Cal. 3d 651.