§ 19-14.6-2 - Limitation on interest and other charges.
SECTION 19-14.6-2
§ 19-14.6-2 Limitation on interest andother charges. – (a) An insurance premium finance company shall not charge, contract for,receive or collect any interest or discount charges at a rate in excess of thatprovided in § 6-26-2.
(b) Interest on any insurance premium finance agreement is tobe computed on the balance of the premium or premiums due, after subtractingthe down payment made by the insured in accordance with the agreement, from theeffective date of the insurance contract, for which the premium or premiums isor are being advanced, to and including the date when the final installmentprovided for in the agreement is due and payable. The interest so provided forby this chapter anticipates timely repayment, in consecutive equal monthlyinstallments, for a period of one year. With respect to contractualarrangements for repayment in greater or lesser periods, or in unequal,irregular, or other than monthly installments, interest may be computed at anequivalent effective rate, likewise, having due regard for timely payments ofinstallments.
(c) A service charge of fifteen dollars ($15.00) perinsurance premium finance agreement, which need not be refunded uponcancellation or prepayment, may be imposed as long as the imposition of saidservice charge does not cause the total charges provided for in the agreementto exceed that specified in § 6-26-2.
(d) Notwithstanding the provisions of any agreement, aninsured may prepay the obligation in full at any time. In that event, theinsured shall receive a refund credit. The refund credit shall represent atleast as great a proportion of the interest as the sum of the periodic balancesfollowing the month in which prepayment is made bears the sum of all periodicbalances under the schedule of installments in the agreement. If the amount ofa refund credit is less than one dollar ($1.00), no actual refund need be made.