(1) Except as provided in subsection (2) of this section, if a creditor contracts for or receives a separate charge for insurance, the amount charged to the consumer for the insurance may not exceed the premium to be charged by the insurer as computed at the time the charge to the consumer is determined conforming to any rate filings required by law and made by the insurer with the commissioner of insurance.
(2) A creditor who provides consumer credit insurance in relation to a revolving credit account may calculate the charge to the consumer in each billing cycle by applying the current premium rate to:
The average daily unpaid balance of the debt in the cycle;
The unpaid balance of the debt or a median amount within a specified range of unpaid balances of debt on approximately the same day of the cycle. The day of the cycle need not be the day used in calculating the finance charge, but the specified range shall be the range used for that purpose; or
The unpaid balances of the amount financed calculated according to the actuarialmethod.
Source: L. 2000: Entire article R&RE, p. 1227, § 1, effective July 1.
Editor's note: This section is similar to former § 5-4-107, as it existed prior to 2000.