1. (a) An industrial loan company shall not offer or sell credit insurance in any manner which restricts a borrower's ability to voluntarily select or reject credit life or credit disability insurance or both.

2. (b) An industrial loan company shall use a written form (which may be separate from or incorporated in the loan documents), which shall be signed or initialed by each of the insured borrowers. The form must be substantially as follows:

   “Sign or initial

   Loan No.

   your election

   I want credit life insurance.

   I do not want credit life insurance.

   I want credit disability insurance.

   I do not want credit disability insurance.”

Note: Authority cited: Section 18347, Financial Code. Reference: Section 18290, Financial Code.

History

1. Change without regulatory effect adding new article 9 (sections 40.900-40.906) and renumbering former section 1201 to new section 40.900 filed 8-19-97 pursuant to section 100, title 1, California Code of Regulations (Register 97, No. 34).