                                 CODE OF VIRGINIA

APPLICATION (§ 38.2-3737)

A. No contract of insurance upon a debtor shall be made or effectuated unless at
the time of the contract, the debtor, being of lawful age and competent to
contract for insurance, applies for the insurance in writing on a form approved
by the Commission.

B. The application or enrollment request shall be required to:

   1. Contain the name and signature of the agent or creditor&#8217;s
   representative, if any, who solicited the application or enrollment request;

   2. Contain the name and address of the insurer and creditor; the name and age
   of the debtor(s); the premium, rate or amount payable by the debtor separately
   for credit life insurance and credit accident and sickness insurance; the type
   of insurance coverage provided; the date of application; and separately, the
   amount and term, including the effective and cancellation dates, of the
   insurance and loan contracts; and

   3. Include the disclosure requirements set forth in subsections A, B, C, D,
   and E of &#xA7; 38.2-3735 unless such requirements have been separately
   disclosed in another form or forms approved by the Commission.

C. The application or enrollment request form shall be separate and apart from
the loan or credit transaction papers and will refer exclusively to insurance
coverage.

D. No individual or group credit life insurance or credit accident and sickness
insurance application form shall contain a question of general good health
unless the application form contains appropriate specific questions concerning
the applicant&#8217;s health history or medical treatment history.

E. Neither this section nor subsection B of § 38.2-3735 shall apply to credit
life or credit accident and sickness insurance that will insure open-end monthly
outstanding balance credit transactions if the following criteria are met:

   1. The credit life insurance and credit accident and sickness insurance that
   will insure the open-end monthly outstanding balance credit transaction are
   offered to the debtor after the loan or credit transaction that it will insure
   has been approved by the creditor and has been effective at least seven days;

   2. 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 life or credit accident and
   sickness insurance;

   3. The creditor makes available only one plan of credit life insurance and one
   plan of credit accident and sickness insurance to the debtor;

   4. The debtor is provided written confirmation of the insurance coverage
   within thirty days of the effective date of such coverage. The effective date
   of coverage shall begin on the date the solicitation is accepted; and

   5. 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 that the policy
   or certificate is delivered to the policyowner 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 included on the face page of
   the policy or certificate, and shall be printed in capital letters and in bold
   12-point or larger type.

F. The following shall be applicable to open-end credit transactions by mail,
telephone, or brochure solicitations, that are not excluded from the
requirements of this section and of subsection B of § 38.2-3735 by subsection
E, where the insurer is offering only one plan of credit life insurance or one
plan of credit accident and sickness insurance:

   1. Section 38.2-3735 shall not apply to such transactions, provided that the
   following disclosures are included in such solicitations, whether as part of
   the application or enrollment request or separately:
   				a. The name and address of the insurer(s) and creditor; and
   				b. 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. Subsections B and D of this section shall not apply to such transactions,
   provided that the application or enrollment request utilized as part of such
   transaction:
   				a. Is printed in a type size of not less than eight-point type, one point
   leaded, notwithstanding the requirements set forth in subdivision D 5 of
   &#xA7; 38.2-3724 regarding minimum type size for policies and certificates;
   				b. Contains a prominent statement that the insurance offered is optional,
   voluntary, or not required;
   				c. Contains no questions relating to insurability other than the
   debtor&#8217;s age or date of birth and, if applicable, active employment
   status; and
   				d. If the disclosures required by subdivision 1 of this subsection are not
   included in the application or enrollment request, makes reference to such
   disclosures with sufficient information so as to assist the reader in locating
   such disclosures within the solicitation.

   3. 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.

G. Notwithstanding the provisions of subsection A, a contract of insurance may
be made or effectuated in connection with a credit transaction between a
creditor regulated pursuant to Chapter 13 (§ 6.2-1300 et seq.) of Title 6.2 or
12 U.S.C. § 1751 et seq. and a debtor who is of lawful age, competent to
contract for the insurance and a member of the creditor if:

   1. The credit transaction and the solicitation for such insurance is effected
   by mail, telephone or other electronic means;

   2. The purchase of credit insurance is not required by the creditor and is not
   a factor in granting the credit;

   3. The creditor or insurer, within three business days after the credit
   transaction is effected, transmits to the debtor, either separately or with
   the documents that pertain to the credit transaction, an application or
   enrollment request form approved by the Commission which includes or to which
   is attached a prominent notice that clearly advises the debtor that unless he
   mails the completed and signed application or enrollment request to the
   creditor within forty-five days following the date of the credit transaction,
   all such coverage requested in connection with the credit transaction will be
   void from the beginning; and

   4. In the event the debtor does not transmit the completed and signed
   application or enrollment request to the creditor within the time specified in
   subdivision 3, the full amount of the premium charged for the insurance is
   returned to or credited to the account of the debtor and written notice
   thereof is sent to the debtor within fifteen days of the date the policy or
   certificate is cancelled.

HISTORY: 1992, c. 586; 1993, c. 627; 1994, c. 202; 1995, c. 167; 1999, c. 586;
2009, c. 643.