                                 CODE OF VIRGINIA

CREDIT LIFE INSURANCE RATES (§ 38.2-3726)

A. The benefits provided by any credit life insurance form shall be deemed
reasonable in relation to the premium charged or to be charged if the rates do
not exceed the rates set forth below, except as such rates are modified pursuant
to the requirements of § 38.2-3730:

   1. $.7519 per month per $1,000 of outstanding insured indebtedness if premiums
   are payable on a monthly outstanding balance basis.

   2. $.48 per $100 of initial indebtedness repayable in twelve equal monthly
   installments. If premiums are payable on a single premium basis and the amount
   of the insurance decreases in equal monthly amounts, the following formula
   shall be used to develop single premium rates from the outstanding balance
   rate:
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   				where Sp is the single term premium per $100 of initial insured
   indebtedness, n is the credit term in months, and Op is the monthly
   outstanding balance rate per $1,000 of outstanding insured indebtedness.

   3. If premiums are payable on a single premium basis when the benefit provided
   is level term, the following formula shall be used to develop single premium
   rates from the outstanding balance rate:
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   				where Sp is the single term premium per $100 of initial insured
   indebtedness, n is the credit term in months, and Op is the monthly
   outstanding balance rate per $1,000 of outstanding insured indebtedness.

   4. If the benefits provided are other than those described in the introduction
   to this subsection, premium rates for such benefits shall be actuarially
   consistent with the rates provided in the above subdivisions.

   5. Joint coverage on any of the bases in this subsection shall not exceed 165
   percent of the specific rate for that type of coverage.

B. The premium rates in subsection A shall apply to policies providing credit
life insurance to be issued with or without evidence of insurability, to be
offered to all debtors, and, except as set forth below, containing: (i) no
exclusions other than suicide within six months of the incurred indebtedness;
and (ii) age restrictions making ineligible for coverage debtors age seventy or
over at the time the indebtedness is incurred or debtors having attained age
seventy or over on the maturity date of the indebtedness.

   1. Insurance written in connection with an open-end credit plan may provide
   for the cessation of insurance or a reduction in the amount of insurance upon
   attainment of an age not less than seventy.

   2. On insurance written in connection with closed-end credit plans and
   open-end credit plans where the amount of insurance is based on or limited to
   the outstanding unpaid balance, no provision excluding or denying a claim for
   death resulting from a preexisting condition except for those conditions for
   which the insured debtor received medical diagnosis or treatment within six
   months preceding the effective date of coverage and which caused the death of
   the insured debtor within six months following the effective date of coverage.
   The effective date of coverage for each part of the insurance attributable to
   a different advance or charge to the plan account is the date on which the
   advance or charge is posted to the plan account.

   3. At the option of the insurer and in lieu of a preexisting condition
   exclusion on insurance written in connection with open-end credit where the
   amount of insurance is based on or limited to the outstanding unpaid balance,
   a provision limiting the amount of insurance payable on death due to natural
   causes to the balance as it existed six months prior to the date of death if
   there have been one or more increases in the outstanding balance during such
   six-month period and if evidence of insurability has not been required in the
   six-month period prior to date of death.

HISTORY: 1992, c. 586.