47-23-102 - Purchase of insurance by mortgagee.
47-23-102. Purchase of insurance by mortgagee.
(a) (1) When a borrower is required to keep real estate insured and to furnish evidence of such insurance to a lender or creditor as a condition for obtaining or keeping the loan, then the lender, mortgagee, assignee, creditor, or any person acting on that person's behalf, who receives and holds funds for the purpose of obtaining or renewing such insurance coverage, shall be required to purchase such coverage as instructed by the borrower or the borrower's agent, if such coverage is reasonably available, to the extent of the funds supplied, but in no event later than ten (10) days after expiration of the existing coverage.
(2) The lender, mortgagee, assignee, creditor, or any person acting on that person's behalf shall have the right to select acceptable insurance companies as the commissioner of commerce and insurance has provided by rule.
(b) (1) Whenever the commissioner has reason to believe that any person has followed a practice or procedure in violation of the provisions of this section, the attorney general and reporter, at the request of the commissioner, may bring an action in the name of the state against such person to restrain by temporary restraining order, temporary injunction, or permanent injunction the commission of such violations.
(2) The court may make such orders or render such judgments as may be necessary to make whole any person or class of persons who have suffered an ascertainable loss by reason of the violation of this section. The court may also enter an order temporarily or permanently revoking a license or certificate authorizing that person to engage in business in this state if the court finds knowing and persistent violations of this section. In the event that no such license or certificate exists, then the court may enter an order temporarily or permanently enjoining that person from doing business in this state.
[Acts 1981, ch. 356, §§ 1, 2; T.C.A., §§ 47-23-104 47-23-105.]