3 AAC 28.390. Prohibited transactions

(a) A consumer credit insurer may not

(1) offer or grant any special favor or advantage, or any valuable consideration or inducement not set out in the insurance contract other than the payment of producers' commissions;

(2) offer to deposit or deposit with a bank or other financial institution, money or securities of the insurer or of any affiliate of the insurer with the design or intent that the deposit of money or securities serve as a compensating balance or offsetting deposit for a loan or other advance;

(3) deposit money or securities with a bank or financial institution without interest or at a lesser rate of interest than is currently being paid other depositors on similar deposits with the bank or financial institution; however, the insurer may maintain demand deposits that are reasonably necessary for use in the ordinary course of business;

(4) sell or offer to sell any capital stock or other security or certificate of debt of the insurer, employee of the insurer, or stockholder of the insurer as an inducement to the sale or placement of consumer credit insurance;

(5) pay or offer to pay any part of the premium for any insurance on the life, health, income, or property of the creditor, an employee of the creditor, or stockholder of the creditor as an inducement to the sale or placement of consumer credit insurance;

(6) extend credit to the creditor by remitting premiums after the grace period of a group policy or beyond 45 days after the effective date of an individual policy; or

(7) engage in any other practices that involve the use of the resources of the insurer for the benefit of the creditor.

(b) A creditor may not collect the insurance premium from the debtor on a single-premium basis and remit that premium to the insurer on any basis other than a single-premium basis.

History: Eff. 3/29/81, Register 77; am 6/6/93, Register 126; am 7/2/2001, Register 158

Authority: AS 21.06.090

AS 21.36.100

AS 21.57.130

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