26-37-125. Types of mechanical breakdown insurance; policy and certificate forms; issuance of policies and certificates.
(a) A mechanical breakdown insurer and a mechanical breakdown insurance organization may write mechanical breakdown insurance as individual, group, blanket or franchise insurance. Each contractual obligation for mechanical breakdown insurance shall be evidenced by a policy. Any insured person under a group policy shall be issued a certificate of coverage.
(b) No policy or certificate of mechanical breakdown insurance shall be issued in this state unless a copy of the form has been filed with and approved by the commissioner.
(c) The commissioner shall not approve any form that does not meet the following requirements:
(i) Policies shall contain a list and description of the mechanical breakdown payments promised or the mechanical breakdowns for which expenses are to be reimbursed, any limits on the amounts to be paid or reimbursed and procedures to be followed by the insured and the insurer in the event of a claim;
(ii) Policies and certificates shall indicate the name of the insurer and the full address of its principal place of business;
(iii) Certificates issued under group policies shall contain a full statement of the benefits provided, any exceptions and claim procedures but may summarize the other terms of the master policy; and
(iv) No policy except a policy issued by a mutual or reciprocal insurance company may provide for assessments on policyholders or for reduction of benefits for the purpose of maintaining the insurer's solvency.
(d) The department may disapprove a policy or certificate form if it finds that it:
(i) Is unfair, unfairly discriminatory, misleading, ambiguous or encourages misrepresentation or misunderstanding of the contract;
(ii) Provides coverage or benefits or contains other provisions that endanger the insurer's solvency; or
(iii) Is contrary to law.