(a) For the purposes of this section, the following terms shall have the following meanings:

1. (1) Credit life insurance means insurance on the life of a debtor in connection with a specific loan or other credit transaction in this State to provide payment to a creditor in the event of the death of the debtor. Credit life insurance does not include:

   1. (i) insurance written in connection with a credit transaction that is:

      1. (a) secured by a first mortgage or deed of trust; and
      2. (b) made to finance the purchase of real property or the construction of a dwelling thereon, or to refinance a prior credit transaction made for such a purpose;
   2. (ii) insurance sold as an isolated transaction on the part of the insurer and not related to an agreement or a plan for insuring debtors of the creditor;
   3. (iii) insurance for which no identifiable charge is made to the debtor; and
   4. (iv) insurance on accounts receivable.
2. (2) Creditor has the meaning contained in section 185.1(d) of this Title (Regulation 27-A).

3. (3) Debtor has the meaning contained in section 185.1(e) of this Title (Regulation 27-A).

   (b) Minimum mortality standards.

4. (1) The following minimum mortality standards may be used for policies issued on or after January 1, 2004, and shall be used for policies issued on or after January 1, 2009:

   1. (i) the minimum standard for both male and female insureds shall be the 2001 CSO Male Composite Ultimate Mortality Table, as defined in Part 100 of this Title (Regulation 179); and
   2. (ii) where the credit life insurance policy or certificate insures two lives, the minimum standard shall be twice the mortality in the 2001 CSO Male Composite Ultimate Mortality Table based on the age of the older insured.

5. (2) For other policies, the minimum mortality standard is as stated in section 4217(c)(2) of the Insurance Law.

   (c) Minimum standards.

6. (1) The interest rates used in determining the minimum standard for valuation shall be the calendar year statutory valuation interest rates as defined in section 4217(c)(4) of the Insurance Law.

7. (2) The method used in determining the minimum standard for valuation for any policy shall be the greater of:

   1. (i) the commissioners reserve valuation method; or
   2. (ii) cash surrender value or premium refund.
8. (3) In applying the commissioners reserve valuation method, consideration should be given to the period of time for which renewability of benefits is guaranteed under the contract. If benefits are guaranteed for less than one year, the method produces a reserve equal to the mortality cost from the valuation date to the premium "paid-to" date.