A. It is unlawful for any person licensed under the New Mexico Small Loan Act of 1955, in connection with the making of a loan under that act:
(1) to sell life insurance other than a term policy or credit life insurance on the principal borrowers;
(2) to sell term or credit life insurance the coverage of which exceeds the amount of the loan or extends beyond the term for which the loan is made;
(3) after having made a loan, to finance any premiums of any life insurance policies, other than credit life insurance, sold to the borrower by the licensee or the licensee's agent in any manner for a period of ninety days;
(4) after having made a loan, to finance any premium of any single-interest property insurance policy sold to the borrower by the licensee or the licensee's agent whereby the premium would be charged to the borrower in any manner. Nothing in this section shall preclude the sale and purchase of an insurance policy covering the dual interest of borrower and lien holder; or
(5) to sell property insurance on unsecured loans.
B. A lender may charge for only the actual cost of any insurance; provided that all insurance shall be written by a company licensed to operate within the state and at a rate not higher than those approved by the superintendent of insurance; and provided further that the lender shall not require any insurance to be written or provided by or through a particular agent, broker or insurer as a condition to making the loan, but shall, at the borrower's option, permit the insurance to be procured from any insurer or agent authorized by law to provide the insurance.
History: 1953 Comp., § 48-17-43.2, enacted by Laws 1969, ch. 58, § 1; 1977, ch. 272, § 1; 1979, ch. 367, § 1; 2019, ch. 201, § 11.
ANNOTATIONSThe 2019 amendment, effective January 1, 2020, provided that a lender may charge for only the actual cost of insurance the lender is allowed to sell under the Small Loan Act and that the insurance must be written by a company licensed to operate in New Mexico at a rate not higher than those approved by the superintendent of insurance; added new subsection designation "A." and redesignated former Subsections A through E as Paragraphs A(1) through A(5); and added Subsection B.
Applicability. — Laws 2019, ch. 201, § 17 provided that the provisions of this act apply to loans subject to the New Mexico Small Loan Act of 1955 and the New Mexico Bank Installment Loan Act of 1959 that are executed on or after January 1, 2020.
Am. Jur. 2d, A.L.R. and C.J.S. references. — 53A Am. Jur. 2d Money Lenders and Pawnbrokers §§ 51, 52.
58 C.J.S. Money Lenders §§ 2, 5.