GENERAL ASSEMBLY OF NORTH CAROLINA
1995 SESSION
CHAPTER 208
AN ACT TO MODIFY THE DEFINITION OF CREDIT ACCIDENT AND HEALTH INSURANCE.
The General Assembly of North Carolina enacts:
Section 1. G.S. 58-57-5 reads as rewritten:
"§ 58-57-5. Definitions.
As used in this Article, unless the context requires otherwise, the following words or terms shall have the meanings herein ascribed to them, respectively:
(1) Repealed by Session Laws 1991, c. 720, s. 6.
(2) 'Credit accident and
health insurance' means insurance on a debtor to provide indemnity for payments
becoming due on a specific loan or other credit transaction as defined in G.S.
58-51-100; G.S. 58-51-100, with or without insurance against death by
accident.
(2a) 'Credit insurance agent' means an
agent of an insurance company licensed in this State who is authorized to
solicit, negotiate or effect credit life insurance, credit accident and health
insurance, credit unemployment insurance, credit property insurance, or any of
them, but only to the extent as is authorized and limited in this Article; Article.
(3) 'Credit life
insurance' means insurance on the life of a debtor pursuant to or in connection
with a specific loan or other credit transaction as defined in G.S.
58-58-10; G.S. 58-58-10.
(4) Recodified as G.S. § 58-57-5(2a) (See Note.)
(4a) 'Credit transaction' means any
transaction by the terms of which the repayment of money loaned or loan
commitment made, or payment for goods, services, or properties sold or leased,
is to be made at a future date or dates; dates.
(4b) 'Credit unemployment insurance'
means insurance on a debtor in connection with a specified loan or other credit
transaction to provide payment to a creditor of the debtor for the installment
payments or other periodic payment becoming due while the debtor is
involuntarily unemployed as defined in the policy; policy.
(5) 'Creditor' means any
lender of money or vendor or lessor of goods, services, property, rights or privileges,
including any person that directly or indirectly provides credit in connection
with any such sale or lease, for which payment is arranged through a
credit-related transaction; or any successor to the right, title or interest of
any such lender, vendor, lessor, or person extending credit, and an affiliate,
associate, or subsidiary of any of them, or any director, officer, or employee
of any of them or any other person in any way associated with any of them; them.
(6) 'Debtor' means a
borrower of money or a purchaser or lessee of goods, services, property, rights
or privileges for which payment is arranged through a credit transaction; transaction.
(7) 'Indebtedness' means
the total amount payable for the term of the loan by debtor to creditor in
connection with a loan or other credit transaction, including principal,
interest, allowable charges, and any premiums authorized hereunder; hereunder.
(7a) 'Joint accident and health
coverage' means credit accident and health insurance covering two or more
debtors; provided that only one monthly benefit, as defined in G.S.
58-57-15(b), shall be payable each month on a specific indebtedness regardless
of the number of debtors insured; insured.
(8) 'Joint life coverage'
means credit life insurance covering two or more lives, the entire amount of
insurance being payable upon the death of the first insured debtor to die; die.
(9) 'Lease' means a contract whereby the lessee of a 'motor vehicle,' as defined in G.S. 20-4.01(23), contracts to pay as compensation for use a sum substantially equivalent to or in excess of the aggregate value of the property, but not exceeding the term of years in G.S. 58-57-1.
(10) 'Open-end credit' means credit extended by a creditor under an agreement in which:
a. The creditor reasonably contemplates repeated transactions;
b. The creditor imposes a finance charge from time to time on an outstanding unpaid balance; and
c. The amount of credit that may be extended to the debtor during the term of the agreement (up to any limit set by the creditor) is generally made available to the extent that any outstanding balance is repaid.
'Open-end credit' includes credit card balances.
(11) 'Truncated coverage' means a
credit insurance benefit with a term of insurance coverage that is less than
the term of the credit transaction; transaction."
Sec. 2. This act is effective upon ratification, and applies to all actions filed on or after the date of ratification.
In the General Assembly read three times and ratified this the 8th day of June, 1995.
───────────────────
Dennis A. Wicker
President of the Senate
───────────────────
Harold J. Brubaker
Speaker of the House of Representatives