C.R.S. § 5-4-101 Short title
5-4-101. Short title. This article shall be known and may be cited as "Uniform Consumer Credit Code - Insurance".
Insurance
C.R.S. tit. 5, art. 4
in effectC.R.S. § 5-4-102 Scope - relation to credit insurance act - applicability to parties
5-4-102. Scope - relation to credit insurance act - applicability to parties. (1) This article applies to insurance provided or to be provided in relation to a consumer credit transaction.
(2) This article supplements and does not repeal the "Credit Insurance Act", article 10 of title 10, C.R.S. The provisions of this code concerning administrative controls, liabilities, and penalties do not apply to persons acting as insurers, and the similar provisions of the "Credit Insurance Act" do not apply to creditors and consumers.
C.R.S. § 5-4-103 Definitions - "consumer credit insurance" - "Credit Insurance Act"
5-4-103. Definitions - "consumer credit insurance" - "Credit Insurance Act". As used in this code, unless the context otherwise requires:
(1) "Consumer credit insurance" means insurance, other than insurance on property, by which the satisfaction of debt in whole or in part is a benefit provided but does not include:
(a) Insurance, as to which a finance charge is imposed and provided in relation to a credit transaction in which a payment is scheduled more than ten years after the extension of credit;
(b) Insurance issued as an isolated transaction on the part of the insurer not related to an agreement or plan for insuring consumers of the creditor; or
(c) Insurance indemnifying the creditor against loss due to the consumer's default.
(2) "Credit Insurance Act" means the "Credit Insurance Act", article 10 of title 10, C.R.S.
C.R.S. § 5-4-104 Creditor's provision of and charge for insurance - excess amount of charge
5-4-104. Creditor's provision of and charge for insurance - excess amount of charge. (1) Except as otherwise provided in this article and subject to the provisions on additional charges contained in section 5-2-202 and maximum charges contained in section 5-2-201, a creditor may agree to provide insurance and may contract for and receive a charge for insurance separate from and in addition to other charges. A creditor need not make a separate charge for insurance provided or required by the creditor. This code does not authorize the issuance of any insurance prohibited under any statute, or rule thereunder, governing the business of insurance.
(2) The excess amount of a charge for insurance provided for in agreements in violation of this article is an excess charge for the purposes of:
(a) The provisions on remedies and penalties contained in article 5 of this title as to effect of violations on rights of parties under section 5-5-201; and
(b) The provisions on administration contained in article 6 of this title as to civil actions by the administrator under section 5-6-114.
C.R.S. § 5-4-105 Conditions applying to insurance to be provided by creditor
5-4-105. Conditions applying to insurance to be provided by creditor. (1) If a creditor agrees with a consumer to provide insurance:
(a) The insurance shall be evidenced by an individual policy or certificate of insurance delivered to the consumer or sent to the consumer at his or her address as stated by the consumer within thirty days after the term of the insurance commences under the agreement between the creditor and consumer; or
(b) The creditor shall promptly notify the consumer of any failure or delay in providing the insurance.
C.R.S. § 5-4-106 Unconscionability
5-4-106. Unconscionability. (1) In applying the provisions of this code on unconscionability contained in sections 5-5-109 and 5-6-112 to a separate charge for insurance, consideration shall be given, among other factors, to:
(a) Potential benefits to the consumer including the satisfaction of the consumer's obligations;
(b) The creditor's need for the protection provided by the insurance; and
(c) The relation between the amount and terms of credit granted and the insurance benefits provided.
(2) If consumer credit insurance otherwise complies with this article and other applicable law, neither the amount nor the term of the insurance nor the amount of a charge therefor is in itself unconscionable.
C.R.S. § 5-4-107 Maximum charge by creditor for insurance
5-4-107. Maximum charge by creditor for insurance. (1) Except as provided in subsection (2) of this section, if a creditor contracts for or receives a separate charge for insurance, the amount charged to the consumer for the insurance may not exceed the premium to be charged by the insurer as computed at the time the charge to the consumer is determined conforming to any rate filings required by law and made by the insurer with the commissioner of insurance.
(2) A creditor who provides consumer credit insurance in relation to a revolving credit account may calculate the charge to the consumer in each billing cycle by applying the current premium rate to:
(a) The average daily unpaid balance of the debt in the cycle;
(b) The unpaid balance of the debt or a median amount within a specified range of unpaid balances of debt on approximately the same day of the cycle. The day of the cycle need not be the day used in calculating the finance charge, but the specified range shall be the range used for that purpose; or
(c) The unpaid balances of the amount financed calculated according to the actuarial method.
C.R.S. § 5-4-108 Refund or credit required - amount
5-4-108. Refund or credit required - amount. (1) (a) Except as provided in subsection (3) of this section, an appropriate refund or credit of unearned premiums shall be made to the person entitled thereto with respect to any separate charge made to the consumer for insurance if:
(I) The insurance is not provided or is provided for a shorter term than that for which the charge to the consumer for insurance was computed; or
(II) The insurance terminates prior to the end of the term for which it was written because of prepayment in full of the indebtedness or the insurance terminates for any other reason.
(b) All consumer credit insurance shall terminate upon prepayment in full of the indebtedness.
(2) If a refund or credit of unearned premiums is required pursuant to the provisions of subsection (1) of this section:
(a) The original creditor, if he or she is the holder of the indebtedness at the time of prepayment, shall either promptly make the appropriate refund or credit or shall promptly notify the consumer and the insurer in writing that a refund or credit is due. Upon the receipt of notice that a refund or credit is due, the insurer shall promptly make an appropriate refund or credit of unearned premiums pursuant to the provisions of section 10-10-110 (2), C.R.S. For purposes of this section, "original creditor" means the person to whom the indebtedness was initially payable, and "insurer" means every person engaged as principal, indemnitor, surety, or contractor in the business of making contracts of insurance, excluding any licensed insurance agent.
(b) (I) The assignee, if the indebtedness has been assigned, shall either promptly make the appropriate refund or credit or shall promptly notify the consumer, the original creditor, and the insurer, if known, in writing that a refund or credit is due. For the purposes of this section, "assignee" means a person other than the original creditor who at the time of prepayment holds the indebtedness.
(II) The original creditor, upon receipt of notice pursuant to subparagraph (I) of this paragraph (b), shall either promptly make the appropriate refund or credit or shall promptly notify the insurer in writing that a refund or credit of unearned premiums is due.
(c) The insurer, upon the receipt of notice that a refund or credit is due pursuant to paragraph (a) or (b) of this subsection (2), shall make an appropriate refund or credit of unearned premiums pursuant to the provisions of section 10-10-110 (2), C.R.S., and subsection (1) of this section.
(d) An assignee or original creditor gives notice pursuant to this section upon delivery or mailing of the notice to the last address provided to him or her. Once an original creditor or an assignee has notified the appropriate party, as provided in paragraphs (a) and (b) of this subsection (2), the original creditor and the assignee shall have no further obligations.
(3) This article does not require a refund or credit of unearned premiums if:
(a) All refunds and credits due to the debtor under this article amount to less than one dollar; or
(b) The charge for insurance is computed from time to time on the outstanding balance of the indebtedness and the charge relates to only one premium period.
(4) Except as otherwise required, a refund or credit is not required because:
(a) The insurance is terminated by payment of proceeds under the policy; or
(b) The original creditor or assignee pays or accounts for premiums to the insurer in the amounts and at the times determined by the agreement between them; or
ding balance of the indebtedness and the charge relates to only one premium period.
(4) Except as otherwise required, a refund or credit is not required because:
(a) The insurance is terminated by payment of proceeds under the policy; or
(b) The original creditor or assignee pays or accounts for premiums to the insurer in the amounts and at the times determined by the agreement between them; or
(c) The original creditor or assignee receives directly or indirectly under any policy of insurance a gain or advantage not prohibited by law.
(5) If a single type of insurance is terminated by the payment of proceeds under the policy pursuant to paragraph (a) of subsection (4) of this section, a refund or credit of unearned premiums for all other types of consumer credit insurance issued on the same indebtedness shall be made if so required by the provisions of this section and section 10-10-110 (2), C.R.S.
(6) A refund or credit required by subsection (1) of this section is appropriate as to amount if it is computed according to a method prescribed or approved by the commissioner of insurance or a formula filed by the insurer with the commissioner of insurance at least thirty days before the consumer's right to a refund or credit becomes determinable unless the method or formula is employed after the commissioner of insurance notifies the insurer that he or she disapproves it.
C.R.S. § 5-4-109 Existing insurance - choice of insurer
5-4-109. Existing insurance - choice of insurer. If a creditor requires insurance, upon notice to the creditor the consumer shall have the option of providing the required insurance through an existing policy of insurance owned or controlled by the consumer or through a policy to be obtained and paid for by the consumer, but the creditor may for reasonable cause decline the insurance provided by the consumer.
C.R.S. § 5-4-110 Charge for insurance in connection with a deferral, refinancing, or consolidation - duplicate charges
5-4-110. Charge for insurance in connection with a deferral, refinancing, or consolidation - duplicate charges. (1) A creditor may not contract for or receive a separate charge for insurance in connection with a deferral described in section 5-2-204, a refinancing described in section 5-2-205, or a consolidation described in section 5-2-206 unless:
(a) The consumer agrees at or before the time of the deferral, refinancing, or consolidation that the charge may be made;
(b) The consumer is or is to be provided with insurance for an amount or a term, or insurance of a kind, in addition to that to which the consumer would have been entitled had there been no deferral, refinancing, or consolidation;
(c) The consumer receives a refund or credit on account of any unexpired term of existing insurance in the amount that would be required if the insurance were terminated under section 5-4-108; and
(d) The charge does not exceed the amount permitted under section 5-4-107.
(2) A creditor may not contract for or receive a separate charge for insurance that duplicates insurance with respect to which the creditor has previously contracted for or received a separate charge.
C.R.S. § 5-4-111 Cooperation between administrator and commissioner of insurance
5-4-111. Cooperation between administrator and commissioner of insurance. The administrator and the commissioner of insurance are authorized and directed to consult and assist one another in maintaining compliance with this article. They may jointly pursue investigations, prosecute suits, and take other official action, as may seem to them appropriate, if either of them is otherwise empowered to take the action. If the administrator is informed of a violation or suspected violation by an insurer of this article or of the insurance laws, rules, and regulations of this state, the administrator shall advise the commissioner of insurance of the circumstances.
C.R.S. § 5-4-112 Administrative action of commissioner of insurance
5-4-112. Administrative action of commissioner of insurance. (1) To the extent that the commissioner's responsibility under this article requires, the commissioner of insurance shall promulgate rules in accordance with article 4 of title 24, C.R.S., with respect to insurers, and with respect to refunds described in section 5-4-108, and, in case of violation, may make an order for compliance.
(2) Sections 24-4-102 to 24-4-106, C.R.S., apply to and govern all administrative action taken by the commissioner of insurance pursuant to this section.
C.R.S. § 5-4-201 Term of insurance
5-4-201. Term of insurance. (1) Consumer credit insurance provided by a creditor may be subject to the furnishing of evidence of insurability satisfactory to the insurer. Whether or not such evidence is required, the term of the insurance shall commence no later than when the consumer becomes obligated to the creditor or when the consumer applies for the insurance, whichever is later, except as follows:
(a) If any required evidence of insurability is not furnished until more than thirty days after the term would otherwise commence, the term may commence on the date when the insurer determines the evidence to be satisfactory; or
(b) If the creditor provides insurance not previously provided covering debts previously created, the term may commence on the effective date of the policy.
(2) The originally scheduled term of the insurance shall extend at least until the due date of the last scheduled payment of the debt except as follows:
(a) If the insurance relates to a revolving credit account, the term need extend only until the payment of the debt under the account and may be sooner terminated after at least thirty days' notice to the consumer; or
(b) If the consumer is advised in writing that the insurance will be written for a specified shorter time, the term need extend only until the end of the specified time.
(3) The term of the insurance shall not extend more than thirty days after the originally scheduled due date of the last scheduled payment of the debt unless it is extended without additional cost to the consumer or as an incident to a deferral, refinancing, or consolidation.
C.R.S. § 5-4-202 Amount of insurance
5-4-202. Amount of insurance. (1) Except as provided in subsection (2) of this section:
(a) In the case of consumer credit insurance providing life coverage, the amount of insurance may not initially exceed the debt and, if the debt is payable in installments, may not at any time exceed the greater of the scheduled or actual amount of the debt; or
(b) In the case of any other consumer credit insurance, the total amount of periodic benefits payable may not exceed the total of scheduled unpaid installments of the debt, and the amount of any periodic benefit may not exceed the original amount of debt divided by the number of periodic installments in which it is payable.
(2) If consumer credit insurance is provided in connection with a revolving credit account, the amounts payable as insurance benefits may be reasonably commensurate with the amount of debt as it exists from time to time. If consumer credit insurance is provided in connection with a commitment to grant credit in the future, the amounts payable as insurance benefits may be reasonably commensurate with the total from time to time of the amount of debt and the amount of the commitment.
C.R.S. § 5-4-203 Filing and approval of rates and forms
5-4-203. Filing and approval of rates and forms. (1) A creditor may not use a form or charge in connection with credit insurance that does not comply with section 10-10-109, C.R.S.
(2) and (3) (Deleted by amendment, L. 2003, p. 1895, § 12, effective July 1, 2003.)
C.R.S. § 5-4-301 Property insurance
5-4-301. Property insurance. (1) A creditor may not contract for or receive a separate charge for insurance against loss of or damage to property unless:
(a) The insurance covers a substantial risk of loss of or damage to property related to the credit transaction;
(b) The amount, terms, and conditions of the insurance are reasonable in relation to the character and value of the property insured or to be insured; and
(c) The term of the insurance is reasonable in relation to the terms of credit.
(2) The term of the insurance is reasonable if it is customary and does not extend substantially beyond a scheduled maturity.
(3) A creditor may not contract for or receive a separate charge for insurance against loss of or damage to property unless the amount financed exclusive of charges for the insurance is one thousand dollars or more and the value of the property is one thousand dollars or more.
C.R.S. § 5-4-302 Insurance on creditor's interest only
5-4-302. Insurance on creditor's interest only. If a creditor contracts for or receives a separate charge for insurance against loss of or damage to property, the risk of loss or damage not willfully caused by the consumer is on the consumer only to the extent of any deficiency in the effective coverage of the insurance even though the insurance covers only the interest of the creditor.
C.R.S. § 5-4-303 Liability insurance
5-4-303. Liability insurance. A creditor may not contract for or receive a separate charge for insurance against liability unless the insurance covers a substantial risk of liability arising out of the ownership or use of property related to the credit transaction.
C.R.S. § 5-4-304 Cancellation by creditor
5-4-304. Cancellation by creditor. This section does not apply to an insurance premium loan. A creditor shall not request cancellation of a policy of property or liability insurance except after the consumer's default or in accordance with a written authorization by the consumer, and in either case the cancellation does not take effect until written notice is delivered to the consumer or mailed to the consumer at his or her address as stated by the consumer. The notice shall state that the policy may be canceled on a date not less than ten days after the notice is delivered or, if the notice is mailed, not less than thirteen days after it is mailed.
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://leg.colorado.gov/sites/default/files/images/olls/crs2024-title-05.docxFetched: 10/6/2026