N.Y. Insurance Law § 3436*2: Group credit unemployment insurance and individual credit unemployment insurance

* § 3436. Group credit unemployment insurance and individual credit

unemployment insurance. (a) Any policy of credit unemployment insurance

which covers more than one person shall be deemed a group credit

unemployment policy.

(b) No policy of group credit unemployment insurance, and no

certificate thereunder, shall be delivered or issued for delivery in

this state unless it conforms to the requirements of this section and

section three thousand two hundred one of this chapter.

(c) A policy of group credit unemployment insurance may only be issued

to a creditor, vendor, trustee, trustees or agent insuring a group of

debtors or vendees, all as defined and set forth in paragraph three of

subsection (b) of section four thousand two hundred sixteen of this

chapter and under the same conditions and limitations and subject to the

definitions as specified therein; provided, however, that the amount of

benefits payable with respect to any person insured thereunder shall not

at any time exceed:

(1) in all cases except as hereinafter provided the lesser of

fifty-five thousand dollars and the total of payments scheduled to be

paid by the person to whom credit has been extended;

(2) in the case of a loan commitment pursuant to a program for

defraying the cost of attendance of a student at a college or university

or at an elementary or secondary school providing education for minors,

the lesser of fifty-five thousand dollars and the total amount of the

unpaid balance of the scheduled periodic payments whether due or not due

and the amount of any outstanding loan commitment pursuant to such a

program;

(3) in the case of a transaction secured by a real estate mortgage,

the lesser of one hundred ten thousand dollars and the total of payments

scheduled to be paid by the person to whom credit has been extended; or

(4) in all cases the amounts of the payment or payments due during the

period of unemployment of the covered person, excluding such amounts

which may have become due by acceleration or default.

(d) Benefits under a policy of group credit unemployment insurance may

be provided to a debtor or vendee only if such debtor or vendee

qualifies for unemployment insurance benefits in this state pursuant to

article eighteen of the labor law or would qualify thereunder but for

exclusion therefrom pursuant to subdivision three, four, five, six, ten

or eleven of section five hundred eleven of the labor law, or by reason

of exhaustion of benefits or length of employment. No insurance company

writing a policy permitted by this section shall, directly or

indirectly, through an agent or representative, have standing to

participate in a hearing or court proceeding in which the eligibility

for unemployment insurance benefits of an insured under this section

shall be in controversy, unless the insured was an employee of said

company.

(e) Credit unemployment insurance may be written separately or in

combination with all or any of the kinds of insurance authorized in

paragraphs three, seven and twenty of subsection (a) of section one

thousand one hundred thirteen of this chapter. The superintendent may by

regulation prohibit or limit any combination based upon the amount of

insured indebtedness or the amount of premium. The premium rate for each

kind of insurance shall be disclosed and the total premium charge for

the combination shall likewise be disclosed.

(f) Acceptance of credit unemployment insurance by a debtor must be

voluntary and not a condition of extending credit nor a factor in the

cost of the credit agreement other than the cost of credit unemployment

insurance. The insurance agreement must be signed and dated separately

from the request for credit and must clearly and conspicuously disclose

to the debtor (1) that the insurance coverage is not required by the

creditor and (2) the cost of the credit unemployment insurance.

(g) (1) Any dividend hereafter apportioned on any participating group

insurance policy, or any rate reduction hereafter made or continued on

any non-participating group policy for the first or any subsequent year

of insurance under any such policy heretofore or hereafter issued under

this section, may be applied to reduce the policyholder's part of the

cost of such policy, except that the excess, if any, of the insured's

aggregate contribution under the policy over the net cost (gross premium

less dividends or rate reductions) of the insurance shall be applied at

the discretion of the insurer either as a cash payment to the insured or

to reduce the insured's premium. If a dividend or rate reduction is

payable upon termination of the policy the insurer shall either make

payment to the insured or to the policyholder upon receipt of a

certification from the policyholder that the dividend or rate reduction

will be distributed by the policyholder to the insureds or applied to

reduce the insured's premium.

(2) The provisions of paragraph one of this subsection shall apply to

New York residents insured under a policy issued in any other

jurisdiction to a group which is described in this section.

* NB There are 2 § 3436's