No insurer shall seek repayment of benefits paid under a supplemental unemployment policy based upon a reversal of a state decision with respect to eligibility for unemployment benefits unless:

1. (a) The state department of employment security has made a finding of fault in accordance with its administrative rules; or
2. (b) The insured has been found to have made a material misrepresentation in the application for coverage that led to approval of the application, where an accurate representation would have resulted in a denial of the application.

Source. #10863, eff 8-1-15; ss by #14507, eff 2-7-26, EXPIRES: 2-7-36