Credit life insurance rates

1. Premium rate. Subject to the conditions and requirements in subsection 2 and section 45-07-01.1-10, the prima facie rates shown below are considered to meet the requirements of section 45-07-01.1-03 and may be used without filing additional actuarial support. a. Monthly outstanding balance basis: Sixty-two cents per month per one thousand dollars of outstanding insured debt on single life insurance and one dollar five cents per month per one thousand dollars of outstanding insured debt on joint life insurance if premiums are payable on a monthly outstanding balance basis. b. Single premium basis: If the premium is charged on a single premium basis, the rate shall be computed according to the following formula or according to a formula approved by the commissioner which produces rates substantially the same as those produced by the following formula: Sp = Single premium per one hundred dollars of initial consumer credit life insurance coverage. Op = Sixty-two cents, the prima facie consumer credit life insurance premium rate for monthly outstanding balance coverage from subdivision a. It = The scheduled amount of insurance for month t. Ii = Initial amount of insurance. For a net insurance policy, Ii equals the initial principal balance of the loan. dis = .0028, representing an annual discount rate of three percent for interest plus four-tenths percent for mortality. n = The number of months in the term of the insurance. c. If the benefits provided are other than those described in the introduction to this subsection, premium rates for such benefits shall be actuarially consistent with the rates provided in subdivisions a and b. d. If life coverage is sold on a joint basis involving two people, the factor for calculating the rate is 1.7. 2. Conditions and requirements. a. Coverage may exclude death resulting from: (1) War or any act of war; (2) Suicide within one year after the effective date of the coverage; (3) A preexisting condition that causes or substantially contributes to death within twelve months of the effective date of coverage; or (4) Terminal illness with a life expectancy of twelve months or less which was diagnosed prior to the effective date of coverage. b. The effective date of coverage for that part of the insurance attributable to a different advance or a charge to the plan account is the date on which the advance or charge occurs. c. An age restriction may be included provided coverage continues until at least age seventy. d. Guaranteed issue amount. An insurer must issue an amount up to five thousand dollars without regard to a debtor's or creditor's health status. An amount in excess of five thousand dollars may be denied based upon the company's underwriting determination. An insurer may apply the exclusions set forth in subdivision a to the entire amount.