§3337. Cancellation of insurance; refund or credit upon cancellation
A. When a consumer lease is cancelled or terminated for any reason, any credit life or credit accident and health insurance paid by the lessee and provided, sold, or obtained through the lessor in connection therewith shall be cancelled. This provision shall not apply where the lessee requests that such insurance remain in force beyond the provision of this Section.
B. When insurance paid by the lessee is cancelled or terminated for any reason, the refund for unearned insurance premiums received by the lessor shall, at the lessor's option, be applied towards payment of the premium for insurance to replace the coverage cancelled, adjusted, or terminated, or towards payment of any unpaid amounts then owing or to be owing in the future under the lease agreement. The order of applying these unearned premiums shall be inverse to the order in which rental payments under the lease agreement are payable according to their terms, beginning with rental payments due on the final due dates and not to the next ensuing rental payment or payments which shall remain payable as originally scheduled. The remaining balance of unearned insurance premiums shall be refunded to the lessee; however, no cash refund shall be required if the amount thereof is less than one dollar.
Acts 1985, No. 592, §1, eff. July 13, 1985; Acts 1986, No. 213, §1.
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