                                 CODE OF VIRGINIA

FORMS OF CREDIT LIFE INSURANCE AND CREDIT ACCIDENT AND SICKNESS INSURANCE (§
38.2-3719)

A. Credit life insurance and credit accident and sickness insurance shall be
issued only in the following forms:

   1. Individual policies of life insurance issued to debtors on the term plan;

   2. Individual policies of accident and sickness insurance issued to debtors on
   a term plan or disability benefit provisions in individual policies of credit
   life insurance;

   3. Group policies of life insurance issued to creditors providing insurance
   upon the lives of debtors on the term plan;

   4. Group policies of accident and sickness insurance issued to creditors on a
   term plan insuring debtors or disability benefit provisions in group credit
   life insurance policies to provide such coverage.

B. A policy of group credit life insurance or group credit accident and sickness
insurance may be issued to a creditor or its parent holding company or to a
trustee, trustees or agent designated by two or more creditors, which creditor,
holding company, affiliate, trustee, trustees or agent shall be deemed the
policyholder, to insure debtors of the creditor or creditors, subject to the
following requirements:

   1. The debtors eligible for insurance under the policy shall be all of the
   debtors of the creditor or creditors, or all of any class or classes of the
   group. The policy may provide that the term &#8220;debtors&#8221; shall
   include (i) borrowers of money or purchasers of goods, services or property
   for which payment is arranged through a credit transaction; (ii) the debtors
   of one or more subsidiary corporations; and (iii) the debtors of one or more
   affiliated corporations, proprietors or partnerships if the business of the
   policyholder and of such affiliated corporations, proprietors or partnerships
   is under common control.

   2. The premium for the policy shall be paid by the policyholder, either from
   the creditor&#8217;s funds, or from charges collected from the insured
   debtors, or from both. Except as provided in subdivision 3 of this subsection,
   a policy on which no part of the premium is to be derived from the collection
   of such identifiable charges must insure all eligible debtors.

   3. Credit life insurance and credit accident and sickness insurance must be
   offered to all eligible debtors of a creditor except those for whom evidence
   of individual insurability is not satisfactory to the insurer.

HISTORY: Code 1950, § 38-428(6); 1950, p. 1001; 1952, c. 317, § 38.1-480;
1960, c. 272, § 38.2-3702; 1962, c. 154; 1975, c. 69; 1982, c. 223, §
38.1-482.3:1; 1983, c. 182; 1986, c. 562; 1987, c. 520; 1992, c. 586.