Debt waiver insurance policies, requirements and coverage
This law covers insurance that backs up debt waivers (agreements where a lender promises to forgive part of what someone owes). The insurance company must pay the lender back for any amount it forgives under a debt waiver. If the loan gets sold to someone else, the insurance still covers it. The insurance stays active unless it is properly cancelled. Even if the insurance is cancelled, the insurance company is still responsible for any debt waivers that were already in place before the cancellation.
407.2040. insurance policies, requirements and coverage. — 1. Contractual or other insurance policies insuring debt waivers shall state the obligation of the to reimburse or pay to the any sums the creditor is legally to under a debt waiver.
2. Coverage under a contractual liability or other insurance policy insuring a debt waiver shall also cover any subsequent upon the , sale, or of the .
3. Coverage under a contractual liability or other insurance policy insuring a debt waiver shall remain in effect unless or terminated in with applicable insurance laws of this state.
4. The or of a contractual liability or other insurance policy shall not reduce the insurer's responsibility for debt waivers issued by the creditor before the date of cancellation or termination and for which has been received by the insurer.
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Source & history notes
(L. 2023 S.B. 398)
Legal information, not legal advice. Always confirm with the official source at revisor.mo.gov.