The bill amends the Michigan Insurance Code of 1956, specifically section 1510, to update regulations regarding insurance premium finance agreements. It establishes that such agreements may include a delinquency charge of $1.00 to a maximum of 5% of the delinquent installment payment, but the total charge cannot exceed $5.00 for certain types of agreements, including those primarily for personal, family, or household purposes, and those with annual premiums not exceeding $10,000 issued to nonprofit organizations. Additionally, if a default leads to the cancellation of an insurance contract, a cancellation charge may be applied.

Furthermore, the bill introduces provisions allowing finance companies to impose fees for payments made via electronic means, such as credit or debit cards, to cover actual processing costs. These fees must not exceed the actual costs incurred and must be disclosed to the insured prior to transaction completion. The insured must also be given the option to cancel the transaction without incurring a fee and to make payments through traditional methods without additional charges. The bill clarifies that fees related to electronic payments are non-refundable and outlines conditions under which fees may not be charged based on payment card network policies.

Statutes affected:
Senate Introduced Bill: 500.1510