Another permitted form of group disability insurance is that which conforms to all of the following conditions.

1. (1) Covering debtors who are or become obligated to repay an indebtedness in substantially equal installments, or to repay a portion of an indebtedness in substantially equal installments over a year or more and repay a final balance in any amount on a date certain thereafter, to one creditor, as “creditor” is defined in subdivision (3) of Section 779.2.
2. (2) The group numbers not less than 10 new entrants yearly.
3. (3) The amounts insured on any one debtor do not exceed those permitted by Section 779.4.

4. (4) The policy is issued upon application of and made payable to the creditor or his successor in interest and such alternate beneficiaries as are required by Article 5.9 (commencing with Section 779.1) of Chapter 1 of Part 2 of Division 1, and the premiums are paid by or through the creditor.

   A policy issued under this section shall conform to all applicable provisions of this code.