{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/38.2-233.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/38.2-233.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/38.2-233.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/38.2-233.html"}],"law_id":84169,"edition_id":1,"section_id":84169,"structure_id":14221,"section_number":"38.2-233","catch_line":"Credit involuntary unemployment insurance; credit property insurance; disclosure and readability","history":"1993, c. 774; 1994, c. 306; 1995, c. 167; 1999, c. 586; 2000, c. 526; 2009, c. 643.","full_text":"A\n\nIf a creditor makes available to the debtors more than one plan of credit involuntary unemployment insurance as defined in § 38.2-122.1, or more than one plan of credit property insurance as defined in § 38.2-122.2, all debtors must be informed of all such plans for which they are eligible.B\n\nWhen elective credit property insurance or elective credit involuntary unemployment insurance is offered, the borrower shall be given written disclosure that purchase of such insurance is not required and is not a factor in granting credit. The disclosure shall also include notice that the borrower has the right to use alternative coverage or to buy insurance elsewhere.C\n\nIf the debtor is given a contract which includes a single premium payment to be charged for elective credit property insurance or elective credit involuntary unemployment insurance, the debtor shall be given:1\n\nA contract which does not include the elective insurance premiums; or2\n\nA disclosure form which shall clearly disclose the difference in premiums charged for a contract with the elective insurance and one without the elective insurance. This disclosure shall include the difference between the amount financed, the monthly payment and the charge for insurance. The form shall be signed and dated by the debtor and the agent, if any, soliciting the application or the creditor’s representative, if any, soliciting the enrollment request. A copy of this disclosure shall be given to the debtor and a copy shall be made a part of the creditor’s loan file.\n\t\t\t\tNothing contained in this subsection shall be construed to prohibit the creditor from combining such disclosure, in order to avoid redundancy, with other forms of disclosure required under state or federal law.D\n\nIf a creditor offers credit property insurance and requires evidence of insurance coverage on personal household property used as security for an indebtedness or credit involuntary unemployment insurance is required as security for any indebtedness, the debtor shall have the option of (i) furnishing the required amount of insurance through existing policies of insurance owned or controlled by him or (ii) procuring and furnishing the required coverage through any insurer authorized to transact insurance in this Commonwealth. The creditor shall inform the debtor of this option in writing and shall obtain the debtor’s signature acknowledging that he understands this option. Nothing contained in this subsection shall be construed to prohibit the creditor from combining such disclosure, in order to avoid redundancy, with other forms of disclosure required under state or federal law.E\n\nNo contract of insurance upon a debtor paid by a single premium shall be made or effectuated unless, at the time of the contract, the debtor is provided with a notice prominently disclosing the right to a refund of premium in the event the insurance is terminated prior to its scheduled maturity date or the insured indebtedness is terminated or paid off early, and of the obligation of the debtor to provide notification to the insurer under subsection G. This notice shall be signed and dated by the debtor and the agent, if any, soliciting the application or the creditor’s representative, if any, soliciting the enrollment request. A copy of the signed notice shall be given to the debtor and a copy shall be made part of the insurer’s file.F\n\nThe disclosure requirements set forth in subsections A, B, C, D, and E shall be disclosed separately from the loan or credit transaction papers in a form or forms approved by the Commission. When credit property insurance or credit involuntary unemployment insurance is offered with credit life insurance or credit accident and sickness insurance, the disclosure requirements set forth in subsections A, B, C, D, and E of § 38.2-233 and the disclosure requirements set forth in subsections A, B, C, D, and E of § 38.2-3735 may be disclosed together in a form which shall be approved by the Commission.G\n\nThe Commission shall not approve any form providing credit property insurance or credit involuntary unemployment insurance unless the policy or certificate is written in nontechnical, readily understandable language, using words of common everyday usage. A form shall be deemed acceptable under this section if the insurer certifies that the form achieves a Flesch Readability Score of forty or more, using the Flesch Readability Formula as set forth in Rudolf Flesch, The Art of Readable Writing (1949, as revised 1974), and certifies compliance with the guidelines set forth in this section.\n\t\t\tThe Commission shall not approve any form providing credit property or credit involuntary unemployment insurance paid by single premium unless the form includes a provision, separately and prominently captioned, stating in substance the following:\n\t\t\t“REFUND OF PREMIUM IN THE EVENT OF EARLY TERMINATION”\n\t\t\t“In the event this insurance policy or certificate is terminated prior to its originally scheduled maturity date, or the insured indebtedness is terminated or paid off earlier than scheduled, the insurer shall, within 30 days of receipt of notification from the debtor of such termination or early payoff, refund or credit any amount paid by the debtor for the insurance beyond the actual date of termination or payoff. Early termination of debt includes termination by renewal or refinancing. The debtor’s notification to the insurer shall include proof of termination or early payoff of the insured indebtedness.”\n\t\t\tThe Commission shall not approve any form providing credit property or credit involuntary unemployment insurance unless the insurance policy or certificate states that the unearned premium refund will be calculated on a pro rata basis. No refund of five dollars or less need be made.\n\t\t\tThe Commission shall not approve any form providing credit property or credit involuntary unemployment insurance unless the form has printed on it a notice stating in substance that if, during a period of at least ten days from the date the policy or certificate is delivered to the policy owner or certificate holder the policy or certificate is surrendered to the insurer or its agent with a written request for cancellation, the policy or certificate shall be void from the beginning and the insurer shall refund any premium paid for the policy or certificate.H\n\nPremium calculations for credit property insurance involving closed end credit transactions shall not be based on amounts paid for finance charges, service fees, delivery charges, taxes, interest, or any other item not covered under the credit property insurance form. If the premium calculations for credit property insurance involving open end monthly outstanding balance credit transactions are based on amounts paid for finance charges, service fees, delivery charges, taxes, interest, meals, entertainment, or any other item not covered under the credit property insurance form, then at least twice per year the premium notice for such insurance shall be accompanied by a disclosure in no smaller than eight-point boldface type substantially similar to the following:\n\t\t\tYour credit property insurance premium is based on the entire outstanding balance of this account. However, your insurance coverage applies only to certain tangible personal property. Finance charges, service fees, delivery charges, taxes, interest, meals, and entertainment are not covered under your policy. Therefore, you may be paying premiums on items not covered under your policy.\n\t\t\tThe disclosure described in this subsection, with the same type-size requirements, shall also be included in any written materials provided at the time of invitation to contract and in policies or certificates provided to insureds.I\n\nA credit property insurance or credit involuntary unemployment insurance policy or certificate which provides truncated or critical period coverage, or any other type of similar coverage that does not provide benefits or coverage for the entire term or amount of the indebtedness, shall be subject to the following requirements:1\n\nThe policy or certificate shall include a statement printed on the face of the policy or first page of the certificate which clearly describes the limited nature of the insurance. The statement shall be printed in capital letters and in bold twelve-point or larger type; and2\n\nThe policy or certificate shall not include any benefits or coverage other than truncated or critical period coverage or any other type of similar coverage that does not provide benefits or coverage for the entire term or amount of the indebtedness.J\n\nA portion of the premium charged for credit property insurance or credit involuntary unemployment insurance may be allowed by the insurer to the creditor for providing and furnishing such insurance, and no such allowance shall be deemed a rebate of premium or as interest charges or consideration or an amount in excess of permitted charges in connection with the loan or other credit transaction.K\n\nAll of the acts necessary to provide and service credit property insurance and credit involuntary unemployment insurance may be performed within the same place of business in which is transacted the business giving rise to the loan or other credit transaction.L\n\nSubsections A, B, C, D, F, and M shall not apply to credit property insurance or credit involuntary unemployment insurance that will insure open end monthly outstanding balance credit transactions if the following criteria are met:1\n\nThe insurance is offered to the debtor after the loan or credit transaction it will insure has been approved by the creditor and has been effective at least seven days;2\n\nThe solicitation for the insurance is by mail or telephone. The person making the solicitation shall not condition the future use or continuation of the open end credit upon the purchase of credit property insurance or credit involuntary unemployment insurance;3\n\nThe creditor makes available only one plan of credit property insurance and only one plan of credit involuntary unemployment insurance to the debtor;4\n\nThe debtor is provided written confirmation of the insurance coverage within thirty days of the effective date of such coverage. The effective date of such coverage shall begin on the date the solicitation is accepted; and5\n\nThe individual policy or certificate has printed on it a notice stating that if, during a period of at least thirty days from the date the policy or certificate is delivered to the policy owner or certificate holder, the policy or certificate is surrendered to the insurer or its agent with a written request for cancellation, the policy or certificate shall be void from the beginning and the insurer shall refund any premium paid for the policy or certificate. This statement shall be prominently located on the face page of the policy or certificate, and shall be printed in capital letters and in bold face twelve-point or larger type.M\n\nSubsections A, B, C, D, F, and L shall not apply to open end credit transactions by mail, telephone, or brochure solicitations that are not excluded from the requirements of subsections A, B, C, D, and F by subsection L where the insurer is offering only one plan of credit property insurance and only one plan of credit involuntary unemployment insurance and the following criteria are met:1\n\nThe following disclosures shall be included in solicitations, whether as part of the application or enrollment request or separately:\n\t\t\t\ta. The name and address of the insurer(s) and creditor; and\n\t\t\t\tb. A description of the coverage offered, including the amount of coverage, the premium rate for the insurance coverage offered, and a description of any exceptions, limitations or restrictions applicable to such coverage.2\n\nThe application or enrollment requests shall comply as follows:\n\t\t\t\ta. Notwithstanding requirements set forth elsewhere, the application and enrollment request shall be printed in a type size of not less than eight-point type, one-point leaded;\n\t\t\t\tb. The application or enrollment request shall contain a prominent statement that the insurance offered is optional, voluntary or not required;\n\t\t\t\tc. The application or enrollment request shall contain no questions relating to insurability other than the debtor’s age or date of birth and, if applicable, active employment status; and\n\t\t\t\td. If the disclosures required by subdivision 1 of this subsection are not included in the application or enrollment request, the application and enrollment request shall make reference to such disclosures with sufficient information to assist the reader in locating such disclosures within separate solicitation material.3\n\nEach insurer proposing to utilize an application or enrollment request in such transactions shall file such form for approval by the Commission. If the insurer anticipates utilizing such application or enrollment form in more than one solicitation, the insurer shall submit, as part of its filing of such form, a certification signed by an officer of the insurer, stating that any such subsequent use of the application or enrollment form will utilize the same form number and will not vary in substance from the wording and format in which the form is submitted for approval. Upon approval of such application or enrollment form by the Commission, the insurer shall be permitted to utilize such form in various solicitation materials provided that the application or enrollment form, when incorporated into such solicitation materials, has the same form number and wording substantially identical to that contained on the approved application or enrollment form. When credit property insurance or credit involuntary unemployment insurance is offered with credit life insurance or credit accident and sickness insurance, insurers may file one common form which shall be subject to prior approval by the Commission and shall incorporate the requirements of subsection M of this section and subsection F of § 38.2-3737, according to the requirements stated in this paragraph and in subdivision F 3 of § 38.2-3737.","order_by":null,"text":{"0":{"id":301660,"text":"If a creditor makes available to the debtors more than one plan of credit involuntary unemployment insurance as defined in § 38.2-122.1, or more than one plan of credit property insurance as defined in § 38.2-122.2, all debtors must be informed of all such plans for which they are eligible.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":301661,"text":"When elective credit property insurance or elective credit involuntary unemployment insurance is offered, the borrower shall be given written disclosure that purchase of such insurance is not required and is not a factor in granting credit. The disclosure shall also include notice that the borrower has the right to use alternative coverage or to buy insurance elsewhere.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"C"},"2":{"id":301662,"text":"If the debtor is given a contract which includes a single premium payment to be charged for elective credit property insurance or elective credit involuntary unemployment insurance, the debtor shall be given:","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B","next_prefix":"C1"},"3":{"id":301663,"text":"A contract which does not include the elective insurance premiums; or","type":"section","prefixes":["C","1"],"prefix":"1","entire_prefix":"C1","prefix_anchor":"C1","level":2,"prior_prefix":"C","next_prefix":"C2"},"4":{"id":301664,"text":"A disclosure form which shall clearly disclose the difference in premiums charged for a contract with the elective insurance and one without the elective insurance. This disclosure shall include the difference between the amount financed, the monthly payment and the charge for insurance. The form shall be signed and dated by the debtor and the agent, if any, soliciting the application or the creditor’s representative, if any, soliciting the enrollment request. A copy of this disclosure shall be given to the debtor and a copy shall be made a part of the creditor’s loan file.\n\t\t\t\tNothing contained in this subsection shall be construed to prohibit the creditor from combining such disclosure, in order to avoid redundancy, with other forms of disclosure required under state or federal law.","type":"section","prefixes":["C","2"],"prefix":"2","entire_prefix":"C2","prefix_anchor":"C2","level":2,"prior_prefix":"C1","next_prefix":"D"},"5":{"id":301665,"text":"If a creditor offers credit property insurance and requires evidence of insurance coverage on personal household property used as security for an indebtedness or credit involuntary unemployment insurance is required as security for any indebtedness, the debtor shall have the option of (i) furnishing the required amount of insurance through existing policies of insurance owned or controlled by him or (ii) procuring and furnishing the required coverage through any insurer authorized to transact insurance in this Commonwealth. The creditor shall inform the debtor of this option in writing and shall obtain the debtor’s signature acknowledging that he understands this option. Nothing contained in this subsection shall be construed to prohibit the creditor from combining such disclosure, in order to avoid redundancy, with other forms of disclosure required under state or federal law.","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C2","next_prefix":"E"},"6":{"id":301666,"text":"No contract of insurance upon a debtor paid by a single premium shall be made or effectuated unless, at the time of the contract, the debtor is provided with a notice prominently disclosing the right to a refund of premium in the event the insurance is terminated prior to its scheduled maturity date or the insured indebtedness is terminated or paid off early, and of the obligation of the debtor to provide notification to the insurer under subsection G. This notice shall be signed and dated by the debtor and the agent, if any, soliciting the application or the creditor’s representative, if any, soliciting the enrollment request. A copy of the signed notice shall be given to the debtor and a copy shall be made part of the insurer’s file.","type":"section","prefixes":["E"],"prefix":"E","entire_prefix":"E","prefix_anchor":"E","level":1,"prior_prefix":"D","next_prefix":"F"},"7":{"id":301667,"text":"The disclosure requirements set forth in subsections A, B, C, D, and E shall be disclosed separately from the loan or credit transaction papers in a form or forms approved by the Commission. When credit property insurance or credit involuntary unemployment insurance is offered with credit life insurance or credit accident and sickness insurance, the disclosure requirements set forth in subsections A, B, C, D, and E of § 38.2-233 and the disclosure requirements set forth in subsections A, B, C, D, and E of § 38.2-3735 may be disclosed together in a form which shall be approved by the Commission.","type":"section","prefixes":["F"],"prefix":"F","entire_prefix":"F","prefix_anchor":"F","level":1,"prior_prefix":"E","next_prefix":"G"},"8":{"id":301668,"text":"The Commission shall not approve any form providing credit property insurance or credit involuntary unemployment insurance unless the policy or certificate is written in nontechnical, readily understandable language, using words of common everyday usage. A form shall be deemed acceptable under this section if the insurer certifies that the form achieves a Flesch Readability Score of forty or more, using the Flesch Readability Formula as set forth in Rudolf Flesch, The Art of Readable Writing (1949, as revised 1974), and certifies compliance with the guidelines set forth in this section.\n\t\t\tThe Commission shall not approve any form providing credit property or credit involuntary unemployment insurance paid by single premium unless the form includes a provision, separately and prominently captioned, stating in substance the following:\n\t\t\t“REFUND OF PREMIUM IN THE EVENT OF EARLY TERMINATION”\n\t\t\t“In the event this insurance policy or certificate is terminated prior to its originally scheduled maturity date, or the insured indebtedness is terminated or paid off earlier than scheduled, the insurer shall, within 30 days of receipt of notification from the debtor of such termination or early payoff, refund or credit any amount paid by the debtor for the insurance beyond the actual date of termination or payoff. Early termination of debt includes termination by renewal or refinancing. The debtor’s notification to the insurer shall include proof of termination or early payoff of the insured indebtedness.”\n\t\t\tThe Commission shall not approve any form providing credit property or credit involuntary unemployment insurance unless the insurance policy or certificate states that the unearned premium refund will be calculated on a pro rata basis. No refund of five dollars or less need be made.\n\t\t\tThe Commission shall not approve any form providing credit property or credit involuntary unemployment insurance unless the form has printed on it a notice stating in substance that if, during a period of at least ten days from the date the policy or certificate is delivered to the policy owner or certificate holder the policy or certificate is surrendered to the insurer or its agent with a written request for cancellation, the policy or certificate shall be void from the beginning and the insurer shall refund any premium paid for the policy or certificate.","type":"section","prefixes":["G"],"prefix":"G","entire_prefix":"G","prefix_anchor":"G","level":1,"prior_prefix":"F","next_prefix":"H"},"9":{"id":301669,"text":"Premium calculations for credit property insurance involving closed end credit transactions shall not be based on amounts paid for finance charges, service fees, delivery charges, taxes, interest, or any other item not covered under the credit property insurance form. If the premium calculations for credit property insurance involving open end monthly outstanding balance credit transactions are based on amounts paid for finance charges, service fees, delivery charges, taxes, interest, meals, entertainment, or any other item not covered under the credit property insurance form, then at least twice per year the premium notice for such insurance shall be accompanied by a disclosure in no smaller than eight-point boldface type substantially similar to the following:\n\t\t\tYour credit property insurance premium is based on the entire outstanding balance of this account. However, your insurance coverage applies only to certain tangible personal property. Finance charges, service fees, delivery charges, taxes, interest, meals, and entertainment are not covered under your policy. Therefore, you may be paying premiums on items not covered under your policy.\n\t\t\tThe disclosure described in this subsection, with the same type-size requirements, shall also be included in any written materials provided at the time of invitation to contract and in policies or certificates provided to insureds.","type":"section","prefixes":["H"],"prefix":"H","entire_prefix":"H","prefix_anchor":"H","level":1,"prior_prefix":"G","next_prefix":"I"},"10":{"id":301670,"text":"A credit property insurance or credit involuntary unemployment insurance policy or certificate which provides truncated or critical period coverage, or any other type of similar coverage that does not provide benefits or coverage for the entire term or amount of the indebtedness, shall be subject to the following requirements:","type":"section","prefixes":["I"],"prefix":"I","entire_prefix":"I","prefix_anchor":"I","level":1,"prior_prefix":"H","next_prefix":"I1"},"11":{"id":301671,"text":"The policy or certificate shall include a statement printed on the face of the policy or first page of the certificate which clearly describes the limited nature of the insurance. The statement shall be printed in capital letters and in bold twelve-point or larger type; and","type":"section","prefixes":["I","1"],"prefix":"1","entire_prefix":"I1","prefix_anchor":"I1","level":2,"prior_prefix":"I","next_prefix":"I2"},"12":{"id":301672,"text":"The policy or certificate shall not include any benefits or coverage other than truncated or critical period coverage or any other type of similar coverage that does not provide benefits or coverage for the entire term or amount of the indebtedness.","type":"section","prefixes":["I","2"],"prefix":"2","entire_prefix":"I2","prefix_anchor":"I2","level":2,"prior_prefix":"I1","next_prefix":"J"},"13":{"id":301673,"text":"A portion of the premium charged for credit property insurance or credit involuntary unemployment insurance may be allowed by the insurer to the creditor for providing and furnishing such insurance, and no such allowance shall be deemed a rebate of premium or as interest charges or consideration or an amount in excess of permitted charges in connection with the loan or other credit transaction.","type":"section","prefixes":["J"],"prefix":"J","entire_prefix":"J","prefix_anchor":"J","level":1,"prior_prefix":"I2","next_prefix":"K"},"14":{"id":301674,"text":"All of the acts necessary to provide and service credit property insurance and credit involuntary unemployment insurance may be performed within the same place of business in which is transacted the business giving rise to the loan or other credit transaction.","type":"section","prefixes":["K"],"prefix":"K","entire_prefix":"K","prefix_anchor":"K","level":1,"prior_prefix":"J","next_prefix":"L"},"15":{"id":301675,"text":"Subsections A, B, C, D, F, and M shall not apply to credit property insurance or credit involuntary unemployment insurance that will insure open end monthly outstanding balance credit transactions if the following criteria are met:","type":"section","prefixes":["L"],"prefix":"L","entire_prefix":"L","prefix_anchor":"L","level":1,"prior_prefix":"K","next_prefix":"L1"},"16":{"id":301676,"text":"The insurance is offered to the debtor after the loan or credit transaction it will insure has been approved by the creditor and has been effective at least seven days;","type":"section","prefixes":["L","1"],"prefix":"1","entire_prefix":"L1","prefix_anchor":"L1","level":2,"prior_prefix":"L","next_prefix":"L2"},"17":{"id":301677,"text":"The solicitation for the insurance is by mail or telephone. The person making the solicitation shall not condition the future use or continuation of the open end credit upon the purchase of credit property insurance or credit involuntary unemployment insurance;","type":"section","prefixes":["L","2"],"prefix":"2","entire_prefix":"L2","prefix_anchor":"L2","level":2,"prior_prefix":"L1","next_prefix":"L3"},"18":{"id":301678,"text":"The creditor makes available only one plan of credit property insurance and only one plan of credit involuntary unemployment insurance to the debtor;","type":"section","prefixes":["L","3"],"prefix":"3","entire_prefix":"L3","prefix_anchor":"L3","level":2,"prior_prefix":"L2","next_prefix":"L4"},"19":{"id":301679,"text":"The debtor is provided written confirmation of the insurance coverage within thirty days of the effective date of such coverage. The effective date of such coverage shall begin on the date the solicitation is accepted; and","type":"section","prefixes":["L","4"],"prefix":"4","entire_prefix":"L4","prefix_anchor":"L4","level":2,"prior_prefix":"L3","next_prefix":"L5"},"20":{"id":301680,"text":"The individual policy or certificate has printed on it a notice stating that if, during a period of at least thirty days from the date the policy or certificate is delivered to the policy owner or certificate holder, the policy or certificate is surrendered to the insurer or its agent with a written request for cancellation, the policy or certificate shall be void from the beginning and the insurer shall refund any premium paid for the policy or certificate. This statement shall be prominently located on the face page of the policy or certificate, and shall be printed in capital letters and in bold face twelve-point or larger type.","type":"section","prefixes":["L","5"],"prefix":"5","entire_prefix":"L5","prefix_anchor":"L5","level":2,"prior_prefix":"L4","next_prefix":"M"},"21":{"id":301681,"text":"Subsections A, B, C, D, F, and L shall not apply to open end credit transactions by mail, telephone, or brochure solicitations that are not excluded from the requirements of subsections A, B, C, D, and F by subsection L where the insurer is offering only one plan of credit property insurance and only one plan of credit involuntary unemployment insurance and the following criteria are met:","type":"section","prefixes":["M"],"prefix":"M","entire_prefix":"M","prefix_anchor":"M","level":1,"prior_prefix":"L5","next_prefix":"M1"},"22":{"id":301682,"text":"The following disclosures shall be included in solicitations, whether as part of the application or enrollment request or separately:\n\t\t\t\ta. The name and address of the insurer(s) and creditor; and\n\t\t\t\tb. A description of the coverage offered, including the amount of coverage, the premium rate for the insurance coverage offered, and a description of any exceptions, limitations or restrictions applicable to such coverage.","type":"section","prefixes":["M","1"],"prefix":"1","entire_prefix":"M1","prefix_anchor":"M1","level":2,"prior_prefix":"M","next_prefix":"M2"},"23":{"id":301683,"text":"The application or enrollment requests shall comply as follows:\n\t\t\t\ta. Notwithstanding requirements set forth elsewhere, the application and enrollment request shall be printed in a type size of not less than eight-point type, one-point leaded;\n\t\t\t\tb. The application or enrollment request shall contain a prominent statement that the insurance offered is optional, voluntary or not required;\n\t\t\t\tc. The application or enrollment request shall contain no questions relating to insurability other than the debtor’s age or date of birth and, if applicable, active employment status; and\n\t\t\t\td. If the disclosures required by subdivision 1 of this subsection are not included in the application or enrollment request, the application and enrollment request shall make reference to such disclosures with sufficient information to assist the reader in locating such disclosures within separate solicitation material.","type":"section","prefixes":["M","2"],"prefix":"2","entire_prefix":"M2","prefix_anchor":"M2","level":2,"prior_prefix":"M1","next_prefix":"M3"},"24":{"id":301684,"text":"Each insurer proposing to utilize an application or enrollment request in such transactions shall file such form for approval by the Commission. If the insurer anticipates utilizing such application or enrollment form in more than one solicitation, the insurer shall submit, as part of its filing of such form, a certification signed by an officer of the insurer, stating that any such subsequent use of the application or enrollment form will utilize the same form number and will not vary in substance from the wording and format in which the form is submitted for approval. Upon approval of such application or enrollment form by the Commission, the insurer shall be permitted to utilize such form in various solicitation materials provided that the application or enrollment form, when incorporated into such solicitation materials, has the same form number and wording substantially identical to that contained on the approved application or enrollment form. When credit property insurance or credit involuntary unemployment insurance is offered with credit life insurance or credit accident and sickness insurance, insurers may file one common form which shall be subject to prior approval by the Commission and shall incorporate the requirements of subsection M of this section and subsection F of § 38.2-3737, according to the requirements stated in this paragraph and in subdivision F 3 of § 38.2-3737.","type":"section","prefixes":["M","3"],"prefix":"3","entire_prefix":"M3","prefix_anchor":"M3","level":2,"prior_prefix":"M2"}},"ancestry":[{"id":14221,"edition_id":1,"name":"Provisions of a General Nature","identifier":"2","label":"chapter","depth":2,"order_by":1,"parent_id":12698,"metadata":{},"date_created":"2026-06-26 03:47:20","date_modified":"2026-06-26 03:47:20","permalink":{"id":213095,"object_type":"structure","relational_id":14221,"identifier":"2","token":"38.2\/2","url":"\/38.2\/2\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12698,"edition_id":1,"name":"Insurance","identifier":"38.2","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:49","date_modified":"2026-06-26 03:43:49","permalink":{"id":210661,"object_type":"structure","relational_id":12698,"identifier":"38.2","token":"38.2","url":"\/38.2\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":84875,"structure_id":14221,"section_number":"38.2-200","catch_line":"General powers of the Commission relative to insurance","url":"\/38.2-200\/","token":"38.2\/2\/38.2-200","metadata":false},{"id":70951,"structure_id":14221,"section_number":"38.2-201","catch_line":"Recommendations by Commission to General Assembly","url":"\/38.2-201\/","token":"38.2\/2\/38.2-201","metadata":false},{"id":71634,"structure_id":14221,"section_number":"38.2-202","catch_line":"Regulation of solicitation of proxies, consents and authorizations","url":"\/38.2-202\/","token":"38.2\/2\/38.2-202","metadata":false},{"id":66056,"structure_id":14221,"section_number":"38.2-203","catch_line":"Management and exclusive agency contracts subject to approval by Commission","url":"\/38.2-203\/","token":"38.2\/2\/38.2-203","metadata":false},{"id":86443,"structure_id":14221,"section_number":"38.2-204","catch_line":"Repealed","url":"\/38.2-204\/","token":"38.2\/2\/38.2-204","metadata":false},{"id":55426,"structure_id":14221,"section_number":"38.2-205.1","catch_line":"Temporary contracts of insurance permitted","url":"\/38.2-205.1\/","token":"38.2\/2\/38.2-205.1","metadata":false},{"id":77907,"structure_id":14221,"section_number":"38.2-206","catch_line":"Corporations as members of mutual insurers","url":"\/38.2-206\/","token":"38.2\/2\/38.2-206","metadata":false},{"id":78608,"structure_id":14221,"section_number":"38.2-207","catch_line":"Enforcement of right of subrogation in name of insured","url":"\/38.2-207\/","token":"38.2\/2\/38.2-207","metadata":false},{"id":66293,"structure_id":14221,"section_number":"38.2-208","catch_line":"Limitation of risks generally","url":"\/38.2-208\/","token":"38.2\/2\/38.2-208","metadata":false},{"id":71333,"structure_id":14221,"section_number":"38.2-209","catch_line":"Award of insured's attorney fees in certain cases","url":"\/38.2-209\/","token":"38.2\/2\/38.2-209","metadata":false},{"id":57078,"structure_id":14221,"section_number":"38.2-210","catch_line":"Loans to officers, directors, etc., prohibited","url":"\/38.2-210\/","token":"38.2\/2\/38.2-210","metadata":false},{"id":75678,"structure_id":14221,"section_number":"38.2-211","catch_line":"Other interests and payments to officers, directors, etc., prohibited","url":"\/38.2-211\/","token":"38.2\/2\/38.2-211","metadata":false},{"id":78879,"structure_id":14221,"section_number":"38.2-212","catch_line":"Certain compensation not prohibited","url":"\/38.2-212\/","token":"38.2\/2\/38.2-212","metadata":false},{"id":85199,"structure_id":14221,"section_number":"38.2-213","catch_line":"Violation of \u00a7 38.2-210 or \u00a7 38.2-211","url":"\/38.2-213\/","token":"38.2\/2\/38.2-213","metadata":false},{"id":74840,"structure_id":14221,"section_number":"38.2-214","catch_line":"Restrictions upon purchase and sale of equity securities of domestic stock insurers","url":"\/38.2-214\/","token":"38.2\/2\/38.2-214","metadata":false},{"id":64172,"structure_id":14221,"section_number":"38.2-215","catch_line":"Liability of president, chief executive officer or directors if insurance issued when insurer insolvent","url":"\/38.2-215\/","token":"38.2\/2\/38.2-215","metadata":false},{"id":66704,"structure_id":14221,"section_number":"38.2-216","catch_line":"Restrictions on removal or transfer of property and on reinsurance; penalty","url":"\/38.2-216\/","token":"38.2\/2\/38.2-216","metadata":false},{"id":81338,"structure_id":14221,"section_number":"38.2-217","catch_line":"When assets may not be distributed among stockholders","url":"\/38.2-217\/","token":"38.2\/2\/38.2-217","metadata":false},{"id":64490,"structure_id":14221,"section_number":"38.2-218","catch_line":"Penalties and restitution payments","url":"\/38.2-218\/","token":"38.2\/2\/38.2-218","metadata":false},{"id":73928,"structure_id":14221,"section_number":"38.2-219","catch_line":"Violations; procedure; cease and desist orders","url":"\/38.2-219\/","token":"38.2\/2\/38.2-219","metadata":false},{"id":63210,"structure_id":14221,"section_number":"38.2-220","catch_line":"Injunctions","url":"\/38.2-220\/","token":"38.2\/2\/38.2-220","metadata":false},{"id":78078,"structure_id":14221,"section_number":"38.2-221","catch_line":"Enforcement of penalties","url":"\/38.2-221\/","token":"38.2\/2\/38.2-221","metadata":false},{"id":86567,"structure_id":14221,"section_number":"38.2-221.1","catch_line":"Confidentiality of information","url":"\/38.2-221.1\/","token":"38.2\/2\/38.2-221.1","metadata":false},{"id":55819,"structure_id":14221,"section_number":"38.2-221.2","catch_line":"Treatment of confidential information pursuant to federal law","url":"\/38.2-221.2\/","token":"38.2\/2\/38.2-221.2","metadata":false},{"id":69354,"structure_id":14221,"section_number":"38.2-221.3","catch_line":"Confidentiality of applications and investigations","url":"\/38.2-221.3\/","token":"38.2\/2\/38.2-221.3","metadata":false},{"id":84985,"structure_id":14221,"section_number":"38.2-222","catch_line":"Appeals generally","url":"\/38.2-222\/","token":"38.2\/2\/38.2-222","metadata":false},{"id":87496,"structure_id":14221,"section_number":"38.2-223","catch_line":"Rules and regulations; orders","url":"\/38.2-223\/","token":"38.2\/2\/38.2-223","metadata":false},{"id":55846,"structure_id":14221,"section_number":"38.2-224","catch_line":"Procedures","url":"\/38.2-224\/","token":"38.2\/2\/38.2-224","metadata":false},{"id":59699,"structure_id":14221,"section_number":"38.2-225","catch_line":"Disposition of fines and penalties","url":"\/38.2-225\/","token":"38.2\/2\/38.2-225","metadata":false},{"id":81892,"structure_id":14221,"section_number":"38.2-226","catch_line":"Provisions of title not to apply to certain mutual aid associations","url":"\/38.2-226\/","token":"38.2\/2\/38.2-226","metadata":false},{"id":66567,"structure_id":14221,"section_number":"38.2-226.1","catch_line":"Expired","url":"\/38.2-226.1\/","token":"38.2\/2\/38.2-226.1","metadata":false},{"id":84770,"structure_id":14221,"section_number":"38.2-226.2","catch_line":"Provisions of title not applicable to certain long-term care health plans","url":"\/38.2-226.2\/","token":"38.2\/2\/38.2-226.2","metadata":false},{"id":84912,"structure_id":14221,"section_number":"38.2-226.3","catch_line":"Expired","url":"\/38.2-226.3\/","token":"38.2\/2\/38.2-226.3","metadata":false},{"id":62181,"structure_id":14221,"section_number":"38.2-227","catch_line":"Public policy regarding punitive damages","url":"\/38.2-227\/","token":"38.2\/2\/38.2-227","metadata":false},{"id":68082,"structure_id":14221,"section_number":"38.2-228","catch_line":"Proof of future financial responsibility","url":"\/38.2-228\/","token":"38.2\/2\/38.2-228","metadata":false},{"id":62523,"structure_id":14221,"section_number":"38.2-229","catch_line":"Immunity from liability","url":"\/38.2-229\/","token":"38.2\/2\/38.2-229","metadata":false},{"id":84512,"structure_id":14221,"section_number":"38.2-230","catch_line":"Distributions by nonstock corporation","url":"\/38.2-230\/","token":"38.2\/2\/38.2-230","metadata":false},{"id":69255,"structure_id":14221,"section_number":"38.2-231","catch_line":"Notice of cancellation, refusal to renew, reduction in coverage or increase in premium of certain liability insurance policies","url":"\/38.2-231\/","token":"38.2\/2\/38.2-231","metadata":false},{"id":82223,"structure_id":14221,"section_number":"38.2-232","catch_line":"Notice of lapse or pending lapse of certain life and accident and sickness insurance policies","url":"\/38.2-232\/","token":"38.2\/2\/38.2-232","metadata":false},{"id":84169,"structure_id":14221,"section_number":"38.2-233","catch_line":"Credit involuntary unemployment insurance; credit property insurance; disclosure and readability","url":"\/38.2-233\/","token":"38.2\/2\/38.2-233","metadata":false},{"id":57202,"structure_id":14221,"section_number":"38.2-234","catch_line":"Release of information","url":"\/38.2-234\/","token":"38.2\/2\/38.2-234","metadata":false},{"id":69385,"structure_id":14221,"section_number":"38.2-235","catch_line":"Liability insurance; carbon monoxide exclusions","url":"\/38.2-235\/","token":"38.2\/2\/38.2-235","metadata":false},{"id":80448,"structure_id":14221,"section_number":"38.2-236","catch_line":"Notice of settlement payment","url":"\/38.2-236\/","token":"38.2\/2\/38.2-236","metadata":false},{"id":83795,"structure_id":14221,"section_number":"38.2-237","catch_line":"Provider complaints","url":"\/38.2-237\/","token":"38.2\/2\/38.2-237","metadata":false}],"previous_section":{"id":82223,"structure_id":14221,"section_number":"38.2-232","catch_line":"Notice of lapse or pending lapse of certain life and accident and sickness insurance policies","url":"\/38.2-232\/","token":"38.2\/2\/38.2-232","metadata":false},"next_section":{"id":57202,"structure_id":14221,"section_number":"38.2-234","catch_line":"Release of information","url":"\/38.2-234\/","token":"38.2\/2\/38.2-234","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/38.2-233\/","history_text":"

This law was first created in 1993. The record of its establishment is cataloged in chapter 774 of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. Unfortunately, the 1993 \u201cActs\u201d aren\u2019t available online. It has been modified 5 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 1994, chapter 306<\/a>; in 1995, chapter 167<\/a>; in 1999, chapter 586<\/a>; in 2000, chapter 526<\/a>; in 2009, chapter 643<\/a>.<\/p>","references":[{"id":84169,"section_number":"38.2-233","catch_line":"Credit involuntary unemployment insurance; credit property insurance; disclosure and readability","order_by":null,"url":"\/38.2-233\/"}],"refers_to":[{"id":69638,"section_number":"38.2-122.1","catch_line":"Credit involuntary unemployment insurance","order_by":null,"url":"\/38.2-122.1\/"},{"id":69580,"section_number":"38.2-122.2","catch_line":"Credit property insurance","order_by":null,"url":"\/38.2-122.2\/"},{"id":84169,"section_number":"38.2-233","catch_line":"Credit involuntary unemployment insurance; credit property insurance; disclosure and readability","order_by":null,"url":"\/38.2-233\/"},{"id":57264,"section_number":"38.2-3735","catch_line":"Disclosure and readability","order_by":null,"url":"\/38.2-3735\/"},{"id":69488,"section_number":"38.2-3737","catch_line":"Application","order_by":null,"url":"\/38.2-3737\/"}],"permalink":{"id":213253,"object_type":"law","relational_id":84169,"identifier":"38.2-233","token":"38.2\/2\/38.2-233","url":"\/38.2-233\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/38.2-233\/","token":"38.2\/2\/38.2-233","dublin_core":{"Title":"Credit involuntary unemployment insurance; credit property insurance; disclosure and readability","Type":"Text","Format":"text\/html","Identifier":"\u00a7 38.2-233","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> If a creditor<\/span> makes available to the debtors more than one plan of credit involuntary unemployment insurance<\/span> as defined in § 38.2-122.1<\/a>, or more than one plan of credit property insurance<\/span> as defined in § 38.2-122.2<\/a>, all debtors must be informed of all such plans for which they are eligible. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> When elective credit property insurance<\/span> or elective credit involuntary unemployment insurance<\/span> is offered, the borrower shall be given written disclosure that purchase of such insurance<\/span> is not required and is not a factor in granting credit. The disclosure shall also include notice that the borrower has the right to use alternative coverage or to buy insurance<\/span> elsewhere. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> If the debtor is given a contract<\/span> which includes a single premium payment to be charged for elective credit property insurance<\/span> or elective credit involuntary unemployment insurance<\/span>, the debtor shall be given: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> A contract<\/span> which does not include the elective insurance<\/span> premiums; or <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> A disclosure form which shall clearly disclose the difference in premiums charged for a contract<\/span> with the elective insurance<\/span> and one without the elective insurance<\/span>. This disclosure shall include the difference between the amount financed, the monthly payment and the charge for insurance<\/span>. The form shall be signed and dated by the debtor and the agent, if any, soliciting the application or the creditor<\/span>’s representative, if any, soliciting the enrollment request. A copy of this disclosure shall be given to the debtor and a copy shall be made a part of the creditor<\/span>’s loan file.\n\t\t\t\tNothing contained in this subsection shall be construed to prohibit the creditor<\/span> from combining such disclosure, in order<\/span> to avoid redundancy, with other forms of disclosure required under state<\/span> or federal law<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> If a creditor<\/span> offers credit property insurance<\/span> and requires evidence<\/span> of insurance<\/span> coverage on personal household property used as security for an indebtedness or credit involuntary unemployment insurance<\/span> is required as security for any indebtedness, the debtor shall have the option of (i) furnishing the required amount of insurance<\/span> through existing policies of insurance<\/span> owned or controlled by him or (ii) procuring and furnishing the required coverage through any insurer<\/span> authorized to transact insurance<\/span> in this Commonwealth. The creditor<\/span> shall inform the debtor of this option in writing and shall obtain the debtor’s signature acknowledging that he understands this option. Nothing contained in this subsection shall be construed to prohibit the creditor<\/span> from combining such disclosure, in order<\/span> to avoid redundancy, with other forms of disclosure required under state<\/span> or federal law<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

E.<\/span> No contract<\/span> of insurance<\/span> upon a debtor paid by a single premium shall be made or effectuated unless, at the time of the contract<\/span>, the debtor is provided with a notice prominently disclosing the right to a refund of premium in the event the insurance<\/span> is terminated prior to its scheduled maturity date or the insured indebtedness is terminated or paid off early, and of the obligation of the debtor to provide notification to the insurer<\/span> under subsection G. This notice shall be signed and dated by the debtor and the agent, if any, soliciting the application or the creditor<\/span>’s representative, if any, soliciting the enrollment request. A copy of the signed notice shall be given to the debtor and a copy shall be made part of the insurer<\/span>’s file. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

F.<\/span> The disclosure requirements set forth in subsections A, B, C, D, and E shall be disclosed separately from the loan or credit transaction papers in a form or forms approved by the Commission<\/span>. When credit property insurance<\/span> or credit involuntary unemployment insurance<\/span> is offered with credit life insurance<\/span> or credit accident and sickness insurance<\/span>, the disclosure requirements set forth in subsections A, B, C, D, and E of § 38.2-233<\/a> and the disclosure requirements set forth in subsections A, B, C, D, and E of § 38.2-3735<\/a> may be disclosed together in a form which shall be approved by the Commission<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

G.<\/span> The Commission<\/span> shall not approve any form providing credit property insurance<\/span> or credit involuntary unemployment insurance<\/span> unless the policy or certificate is written in nontechnical, readily understandable language, using words of common everyday usage. A form shall be deemed acceptable under this section if the insurer<\/span> certifies that the form achieves a Flesch Readability Score of forty or more, using the Flesch Readability Formula as set forth in Rudolf Flesch, The Art of Readable Writing (1949, as revised 1974), and certifies compliance with the guidelines set forth in this section.\n\t\t\tThe Commission<\/span> shall not approve any form providing credit property or credit involuntary unemployment insurance<\/span> paid by single premium unless the form includes a provision, separately and prominently captioned, stating in substance the following:\n\t\t\t“REFUND OF PREMIUM IN THE EVENT OF EARLY TERMINATION”\n\t\t\t“In the event this insurance<\/span> policy or certificate is terminated prior to its originally scheduled maturity date, or the insured indebtedness is terminated or paid off earlier than scheduled, the insurer<\/span> shall, within 30 days of receipt of notification from the debtor of such termination or early payoff, refund or credit any amount paid by the debtor for the insurance<\/span> beyond the actual date of termination or payoff. Early termination of debt includes termination by renewal or refinancing. The debtor’s notification to the insurer<\/span> shall include proof of termination or early payoff of the insured indebtedness.”\n\t\t\tThe Commission<\/span> shall not approve any form providing credit property or credit involuntary unemployment insurance<\/span> unless the insurance<\/span> policy or certificate states<\/span> that the unearned premium refund will be calculated on a pro rata basis. No refund of five dollars or less need be made.\n\t\t\tThe Commission<\/span> shall not approve any form providing credit property or credit involuntary unemployment insurance<\/span> unless the form has printed on it a notice stating in substance that if, during a period of at least ten days from the date the policy or certificate is delivered to the policy owner or certificate holder the policy or certificate is surrendered to the insurer<\/span> or its agent with a written request for cancellation, the policy or certificate shall be void from the beginning and the insurer<\/span> shall refund any premium paid for the policy or certificate. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

H.<\/span> Premium calculations for credit property insurance<\/span> involving closed end credit transactions shall not be based on amounts paid for finance charges, service fees, delivery charges, taxes, interest, or any other item not covered under the credit property insurance<\/span> form. If the premium calculations for credit property insurance<\/span> involving open end monthly outstanding balance credit transactions are based on amounts paid for finance charges, service fees, delivery charges, taxes, interest, meals, entertainment, or any other item not covered under the credit property insurance<\/span> form, then at least twice per year the premium notice for such insurance<\/span> shall be accompanied by a disclosure in no smaller than eight-point boldface type substantially similar to the following:\n\t\t\tYour credit property insurance<\/span> premium is based on the entire outstanding balance of this account. However, your insurance<\/span> coverage applies only to certain tangible personal property. Finance charges, service fees, delivery charges, taxes, interest, meals, and entertainment are not covered under your policy. Therefore, you may be paying premiums on items not covered under your policy.\n\t\t\tThe disclosure described in this subsection, with the same type-size requirements, shall also be included in any written materials<\/span> provided at the time of invitation to contract<\/span> and in policies or certificates provided to insureds. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

I.<\/span> A credit property insurance<\/span> or credit involuntary unemployment insurance<\/span> policy or certificate which provides truncated or critical period coverage, or any other type of similar coverage that does not provide benefits or coverage for the entire term or amount of the indebtedness, shall be subject to the following requirements: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> The policy or certificate shall include a statement printed on the face of the policy or first page of the certificate which clearly describes the limited nature of the insurance<\/span>. The statement shall be printed in capital letters and in bold twelve-point or larger type; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> The policy or certificate shall not include any benefits or coverage other than truncated or critical period coverage or any other type of similar coverage that does not provide benefits or coverage for the entire term or amount of the indebtedness. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

J.<\/span> A portion of the premium charged for credit property insurance<\/span> or credit involuntary unemployment insurance<\/span> may be allowed by the insurer<\/span> to the creditor<\/span> for providing and furnishing such insurance<\/span>, and no such allowance shall be deemed a rebate of premium or as interest charges or consideration or an amount in excess of permitted charges in connection with the loan or other credit transaction. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

K.<\/span> All of the acts necessary to provide and service credit property insurance<\/span> and credit involuntary unemployment insurance<\/span> may be performed within the same place of business in which is transacted the business giving rise to the loan or other credit transaction. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

L.<\/span> Subsections A, B, C, D, F, and M shall not apply to credit property insurance<\/span> or credit involuntary unemployment insurance<\/span> that will insure open end monthly outstanding balance credit transactions if the following criteria are met: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> The insurance<\/span> is offered to the debtor after the loan or credit transaction it will insure has been approved by the creditor<\/span> and has been effective at least seven days; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> The solicitation for the insurance<\/span> is by mail or telephone. The person<\/span> making the solicitation shall not condition the future use or continuation of the open end credit upon the purchase of credit property insurance<\/span> or credit involuntary unemployment insurance<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> The creditor<\/span> makes available only one plan of credit property insurance<\/span> and only one plan of credit involuntary unemployment insurance<\/span> to the debtor; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> The debtor is provided written confirmation of the insurance<\/span> coverage within thirty days of the effective date of such coverage. The effective date of such coverage shall begin on the date the solicitation is accepted; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

5.<\/span> The individual policy or certificate has printed on it a notice stating that if, during a period of at least thirty days from the date the policy or certificate is delivered to the policy owner or certificate holder, the policy or certificate is surrendered to the insurer<\/span> or its agent with a written request for cancellation, the policy or certificate shall be void from the beginning and the insurer<\/span> shall refund any premium paid for the policy or certificate. This statement shall be prominently located on the face page of the policy or certificate, and shall be printed in capital letters and in bold face twelve-point or larger type. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

M.<\/span> Subsections A, B, C, D, F, and L shall not apply to open end credit transactions by mail, telephone, or brochure solicitations that are not excluded from the requirements of subsections A, B, C, D, and F by subsection L where the insurer<\/span> is offering only one plan of credit property insurance<\/span> and only one plan of credit involuntary unemployment insurance<\/span> and the following criteria are met: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> The following disclosures shall be included in solicitations, whether as part of the application or enrollment request or separately:\n\t\t\t\ta. The name and address of the insurer<\/span>(s) and creditor<\/span>; and\n\t\t\t\tb. A description of the coverage offered, including the amount of coverage, the premium rate<\/span> for the insurance<\/span> coverage offered, and a description of any exceptions, limitations or restrictions applicable to such coverage. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> The application or enrollment requests shall comply as follows:\n\t\t\t\ta. Notwithstanding requirements set forth elsewhere, the application and enrollment request shall be printed in a type size of not less than eight-point type, one-point leaded;\n\t\t\t\tb. The application or enrollment request shall contain a prominent statement that the insurance<\/span> offered is optional, voluntary or not required;\n\t\t\t\tc. The application or enrollment request shall contain no questions relating to insurability other than the debtor’s age or date of birth and, if applicable, active employment status; and\n\t\t\t\td. If the disclosures required by subdivision 1 of this subsection are not included in the application or enrollment request, the application and enrollment request shall make reference to such disclosures with sufficient information to assist the reader in locating such disclosures within separate solicitation material<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> Each insurer<\/span> proposing to utilize an application or enrollment request in such transactions shall file such form for approval by the Commission<\/span>. If the insurer<\/span> anticipates utilizing such application or enrollment form in more than one solicitation, the insurer<\/span> shall submit, as part of its filing of such form, a certification signed by an officer of the insurer<\/span>, stating that any such subsequent use of the application or enrollment form will utilize the same form number and will not vary in substance from the wording and format in which the form is submitted for approval. Upon approval of such application or enrollment form by the Commission<\/span>, the insurer<\/span> shall be permitted to utilize such form in various solicitation materials<\/span> provided that the application or enrollment form, when incorporated into such solicitation materials<\/span>, has the same form number and wording substantially identical to that contained on the approved application or enrollment form. When credit property insurance<\/span> or credit involuntary unemployment insurance<\/span> is offered with credit life insurance<\/span> or credit accident and sickness insurance<\/span>, insurers<\/span> may file one common form which shall be subject to prior approval by the Commission<\/span> and shall incorporate the requirements of subsection M of this section and subsection F of § 38.2-3737<\/a>, according to the requirements stated in this paragraph and in subdivision F 3 of § 38.2-3737<\/a>. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nCREDIT INVOLUNTARY UNEMPLOYMENT INSURANCE; CREDIT PROPERTY INSURANCE; DISCLOSURE\nAND READABILITY (\u00a7 38.2-233)\n\nA. If a creditor makes available to the debtors more than one plan of credit\ninvoluntary unemployment insurance as defined in § 38.2-122.1, or more than\none plan of credit property insurance as defined in § 38.2-122.2, all\ndebtors must be informed of all such plans for which they are eligible.\n\nB. When elective credit property insurance or elective credit involuntary\nunemployment insurance is offered, the borrower shall be given written\ndisclosure that purchase of such insurance is not required and is not a factor\nin granting credit. The disclosure shall also include notice that the borrower\nhas the right to use alternative coverage or to buy insurance elsewhere.\n\nC. If the debtor is given a contract which includes a single premium payment to\nbe charged for elective credit property insurance or elective credit involuntary\nunemployment insurance, the debtor shall be given:\n\n 1. A contract which does not include the elective insurance premiums; or\n\n 2. A disclosure form which shall clearly disclose the difference in premiums\n charged for a contract with the elective insurance and one without the\n elective insurance. This disclosure shall include the difference between the\n amount financed, the monthly payment and the charge for insurance. The form\n shall be signed and dated by the debtor and the agent, if any, soliciting the\n application or the creditor’s representative, if any, soliciting the\n enrollment request. A copy of this disclosure shall be given to the debtor and\n a copy shall be made a part of the creditor’s loan file.\n \t\t\t\tNothing contained in this subsection shall be construed to prohibit the\n creditor from combining such disclosure, in order to avoid redundancy, with\n other forms of disclosure required under state or federal law.\n\nD. If a creditor offers credit property insurance and requires evidence of\ninsurance coverage on personal household property used as security for an\nindebtedness or credit involuntary unemployment insurance is required as\nsecurity for any indebtedness, the debtor shall have the option of (i)\nfurnishing the required amount of insurance through existing policies of\ninsurance owned or controlled by him or (ii) procuring and furnishing the\nrequired coverage through any insurer authorized to transact insurance in this\nCommonwealth. The creditor shall inform the debtor of this option in writing and\nshall obtain the debtor’s signature acknowledging that he understands this\noption. Nothing contained in this subsection shall be construed to prohibit the\ncreditor from combining such disclosure, in order to avoid redundancy, with\nother forms of disclosure required under state or federal law.\n\nE. No contract of insurance upon a debtor paid by a single premium shall be made\nor effectuated unless, at the time of the contract, the debtor is provided with\na notice prominently disclosing the right to a refund of premium in the event\nthe insurance is terminated prior to its scheduled maturity date or the insured\nindebtedness is terminated or paid off early, and of the obligation of the\ndebtor to provide notification to the insurer under subsection G. This notice\nshall be signed and dated by the debtor and the agent, if any, soliciting the\napplication or the creditor’s representative, if any, soliciting the\nenrollment request. A copy of the signed notice shall be given to the debtor and\na copy shall be made part of the insurer’s file.\n\nF. The disclosure requirements set forth in subsections A, B, C, D, and E shall\nbe disclosed separately from the loan or credit transaction papers in a form or\nforms approved by the Commission. When credit property insurance or credit\ninvoluntary unemployment insurance is offered with credit life insurance or\ncredit accident and sickness insurance, the disclosure requirements set forth in\nsubsections A, B, C, D, and E of § 38.2-233 and the disclosure requirements\nset forth in subsections A, B, C, D, and E of § 38.2-3735 may be disclosed\ntogether in a form which shall be approved by the Commission.\n\nG. The Commission shall not approve any form providing credit property insurance\nor credit involuntary unemployment insurance unless the policy or certificate is\nwritten in nontechnical, readily understandable language, using words of common\neveryday usage. A form shall be deemed acceptable under this section if the\ninsurer certifies that the form achieves a Flesch Readability Score of forty or\nmore, using the Flesch Readability Formula as set forth in Rudolf Flesch, The\nArt of Readable Writing (1949, as revised 1974), and certifies compliance with\nthe guidelines set forth in this section.\n\t\t\tThe Commission shall not approve any form providing credit property or credit\ninvoluntary unemployment insurance paid by single premium unless the form\nincludes a provision, separately and prominently captioned, stating in substance\nthe following:\n\t\t\t“REFUND OF PREMIUM IN THE EVENT OF EARLY TERMINATION”\n\t\t\t“In the event this insurance policy or certificate is terminated prior\nto its originally scheduled maturity date, or the insured indebtedness is\nterminated or paid off earlier than scheduled, the insurer shall, within 30 days\nof receipt of notification from the debtor of such termination or early payoff,\nrefund or credit any amount paid by the debtor for the insurance beyond the\nactual date of termination or payoff. Early termination of debt includes\ntermination by renewal or refinancing. The debtor’s notification to the\ninsurer shall include proof of termination or early payoff of the insured\nindebtedness.”\n\t\t\tThe Commission shall not approve any form providing credit property or credit\ninvoluntary unemployment insurance unless the insurance policy or certificate\nstates that the unearned premium refund will be calculated on a pro rata basis.\nNo refund of five dollars or less need be made.\n\t\t\tThe Commission shall not approve any form providing credit property or credit\ninvoluntary unemployment insurance unless the form has printed on it a notice\nstating in substance that if, during a period of at least ten days from the date\nthe policy or certificate is delivered to the policy owner or certificate holder\nthe policy or certificate is surrendered to the insurer or its agent with a\nwritten request for cancellation, the policy or certificate shall be void from\nthe beginning and the insurer shall refund any premium paid for the policy or\ncertificate.\n\nH. Premium calculations for credit property insurance involving closed end\ncredit transactions shall not be based on amounts paid for finance charges,\nservice fees, delivery charges, taxes, interest, or any other item not covered\nunder the credit property insurance form. If the premium calculations for credit\nproperty insurance involving open end monthly outstanding balance credit\ntransactions are based on amounts paid for finance charges, service fees,\ndelivery charges, taxes, interest, meals, entertainment, or any other item not\ncovered under the credit property insurance form, then at least twice per year\nthe premium notice for such insurance shall be accompanied by a disclosure in no\nsmaller than eight-point boldface type substantially similar to the following:\n\t\t\tYour credit property insurance premium is based on the entire outstanding\nbalance of this account. However, your insurance coverage applies only to\ncertain tangible personal property. Finance charges, service fees, delivery\ncharges, taxes, interest, meals, and entertainment are not covered under your\npolicy. Therefore, you may be paying premiums on items not covered under your\npolicy.\n\t\t\tThe disclosure described in this subsection, with the same type-size\nrequirements, shall also be included in any written materials provided at the\ntime of invitation to contract and in policies or certificates provided to\ninsureds.\n\nI. A credit property insurance or credit involuntary unemployment insurance\npolicy or certificate which provides truncated or critical period coverage, or\nany other type of similar coverage that does not provide benefits or coverage\nfor the entire term or amount of the indebtedness, shall be subject to the\nfollowing requirements:\n\n 1. The policy or certificate shall include a statement printed on the face of\n the policy or first page of the certificate which clearly describes the\n limited nature of the insurance. The statement shall be printed in capital\n letters and in bold twelve-point or larger type; and\n\n 2. The policy or certificate shall not include any benefits or coverage other\n than truncated or critical period coverage or any other type of similar\n coverage that does not provide benefits or coverage for the entire term or\n amount of the indebtedness.\n\nJ. A portion of the premium charged for credit property insurance or credit\ninvoluntary unemployment insurance may be allowed by the insurer to the creditor\nfor providing and furnishing such insurance, and no such allowance shall be\ndeemed a rebate of premium or as interest charges or consideration or an amount\nin excess of permitted charges in connection with the loan or other credit\ntransaction.\n\nK. All of the acts necessary to provide and service credit property insurance\nand credit involuntary unemployment insurance may be performed within the same\nplace of business in which is transacted the business giving rise to the loan or\nother credit transaction.\n\nL. Subsections A, B, C, D, F, and M shall not apply to credit property insurance\nor credit involuntary unemployment insurance that will insure open end monthly\noutstanding balance credit transactions if the following criteria are met:\n\n 1. The insurance is offered to the debtor after the loan or credit transaction\n it will insure has been approved by the creditor and has been effective at\n least seven days;\n\n 2. The solicitation for the insurance is by mail or telephone. The person\n making the solicitation shall not condition the future use or continuation of\n the open end credit upon the purchase of credit property insurance or credit\n involuntary unemployment insurance;\n\n 3. The creditor makes available only one plan of credit property insurance and\n only one plan of credit involuntary unemployment insurance to the debtor;\n\n 4. The debtor is provided written confirmation of the insurance coverage\n within thirty days of the effective date of such coverage. The effective date\n of such coverage shall begin on the date the solicitation is accepted; and\n\n 5. The individual policy or certificate has printed on it a notice stating\n that if, during a period of at least thirty days from the date the policy or\n certificate is delivered to the policy owner or certificate holder, the policy\n or certificate is surrendered to the insurer or its agent with a written\n request for cancellation, the policy or certificate shall be void from the\n beginning and the insurer shall refund any premium paid for the policy or\n certificate. This statement shall be prominently located on the face page of\n the policy or certificate, and shall be printed in capital letters and in bold\n face twelve-point or larger type.\n\nM. Subsections A, B, C, D, F, and L shall not apply to open end credit\ntransactions by mail, telephone, or brochure solicitations that are not excluded\nfrom the requirements of subsections A, B, C, D, and F by subsection L where the\ninsurer is offering only one plan of credit property insurance and only one plan\nof credit involuntary unemployment insurance and the following criteria are met:\n\n 1. The following disclosures shall be included in solicitations, whether as\n part of the application or enrollment request or separately:\n \t\t\t\ta. The name and address of the insurer(s) and creditor; and\n \t\t\t\tb. A description of the coverage offered, including the amount of\n coverage, the premium rate for the insurance coverage offered, and a\n description of any exceptions, limitations or restrictions applicable to such\n coverage.\n\n 2. The application or enrollment requests shall comply as follows:\n \t\t\t\ta. Notwithstanding requirements set forth elsewhere, the application and\n enrollment request shall be printed in a type size of not less than\n eight-point type, one-point leaded;\n \t\t\t\tb. The application or enrollment request shall contain a prominent\n statement that the insurance offered is optional, voluntary or not required;\n \t\t\t\tc. The application or enrollment request shall contain no questions\n relating to insurability other than the debtor’s age or date of birth\n and, if applicable, active employment status; and\n \t\t\t\td. If the disclosures required by subdivision 1 of this subsection are not\n included in the application or enrollment request, the application and\n enrollment request shall make reference to such disclosures with sufficient\n information to assist the reader in locating such disclosures within separate\n solicitation material.\n\n 3. Each insurer proposing to utilize an application or enrollment request in\n such transactions shall file such form for approval by the Commission. If the\n insurer anticipates utilizing such application or enrollment form in more than\n one solicitation, the insurer shall submit, as part of its filing of such\n form, a certification signed by an officer of the insurer, stating that any\n such subsequent use of the application or enrollment form will utilize the\n same form number and will not vary in substance from the wording and format in\n which the form is submitted for approval. Upon approval of such application or\n enrollment form by the Commission, the insurer shall be permitted to utilize\n such form in various solicitation materials provided that the application or\n enrollment form, when incorporated into such solicitation materials, has the\n same form number and wording substantially identical to that contained on the\n approved application or enrollment form. When credit property insurance or\n credit involuntary unemployment insurance is offered with credit life\n insurance or credit accident and sickness insurance, insurers may file one\n common form which shall be subject to prior approval by the Commission and\n shall incorporate the requirements of subsection M of this section and\n subsection F of § 38.2-3737, according to the requirements stated in this\n paragraph and in subdivision F 3 of § 38.2-3737.\n\nHISTORY: 1993, c. 774; 1994, c. 306; 1995, c. 167; 1999, c. 586; 2000, c. 526;\n2009, c. 643.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}