3 AAC 07.330. Refund of unearned service charge on accounts terminated due to default

(a) If a premium finance agreement is terminated because of a borrower's default, the refund of the unearned service charge must be computed by the licensee from the date that the borrower's balance was paid in full.

(b) A refund credit of the unearned service charge made under this section must be computed by the licensee in accordance with the sum-of-the-digits method, commonly known as the Rule of 78's.

(c) The nonrefundable charge of a maximum of $10 per premium finance agreement may be excluded from the computation for a refund under this section since interest may not be charged for that fee.

History: Eff. 4/28/79, Register 70; am 11/14/80, Register 76; am 4/16/2000, Register 154

Authority: AS 06.40.120

AS 06.40.150

AS 06.40.180

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