Opinion ID: 348299
Heading Depth: 1
Heading Rank: 3

Heading: The Disclosure of Credit Life and Disability Insurance

Text: The security agreement provided: 25 CREDIT LIFE AND DISABILITY INSURANCE is not required to obtain this loan. Such insurance will only be procured for the term of the loan if Customer(s) request(s) Creditor to obtain such insurance by signing below: 26 In Doggett v. Ritter Finance Co., 528 F.2d 860 (4th Cir. 1975), the Fourth Circuit held that a similar provision was clear and concise and satisfied the disclosure requirements of Regulation Z. 12 C.F.R. § 226.4(a)(5). 27 The regulations authorize the exclusion of an insurance premium from the finance charge if the fact that insurance is not required is clearly disclosed to the customer in writing and the customer desiring such insurance coverage signs a specific dated and affirmed written indication of such desire after receiving written disclosure of the cost of the insurance. All of these requirements were met in this case. 28 Although plaintiff asserts that she never requested or desired insurance coverage, but merely signed the documents when told to do so, this assertion is insufficient to vary the terms of the contract or to negate the creditor's full compliance with the disclosure requirements of Regulation Z. The defendant correctly contends that, absent a claim of illiteracy, fraud or duress, no extraneous oral evidence can be presented by the plaintiff to prove that the defendant gave her the impression that the insurance was required. An an FTC informal staff opinion has said: 29 A written disclosure statement given to the consumer as required by the Truth-In-Lending Act, before consummation of the transaction, is a protection against oral misrepresentations that induce a loan. Consumers must learn to inspect disclosure statements before signing a contract, otherwise the purpose of the Act and Regulation Z will be frustrated. 30 FTC Informal Staff Opinion of Dec. 9, 1969, (1969-1974 Transfer Binder), CCH CONS.CRED.GUIDE P 30,309. Consumers should not be encouraged to avoid reading or to ignore the information the Act requires to be provided. In addition, the Court can apply the parole evidence rule in this situation to further, not derogate, the purposes of the Act. In this situation therefore Georgia's parole evidence rule is not in conflict with the purposes of the federal statute. 31 Finally, summary judgment was appropriate on this issue because there was no issue as to any material fact. Anthony's affidavit reads in material part: 32 That I never requested or desired any insurance coverage in connection with the loan transaction. That all of the documents I signed were filled out by the loan company and I merely signed the documents when told to do so. 33 Thus, the affidavit does not place in question whether the defendant required purchase of credit life insurance coverage.