Force Place Insurance
Last Review
Last Update
Statutes
"The Mississippi Creditor-Placed Insurance Act provides for the regulation of force place insurance. Miss. Code § 83-54
The purposes of the chapter is to regulate creditor-placed insurance; create a legal framework within which creditor-placed insurance may be written;help maintain the separation between creditors and insurers; and minimize the possibilities of unfair competitive practices in the sale of creditor-placed insurance. Miss. Code § 83-54-1 "
Cases
Under Mississippi law, force placed insurance (a/k/a collateral protection insurance) provisions are valid and enforceable provided that the terms are fully disclosed and the rate charged is not excessive. See American Bankers' Ins. Co. v. Wells, 819 So. 2d 1196 (Miss. 2001); General Motors Acceptance Corp. v. Baymon, 732 So. 2d 262 (Miss. 1999). Rates approved by the Department of Insurance are not excessive. Wells, 819 So. 2d 1196.
Comments
As a result of several high verdicts returned in Mississippi relating to these types of contract provisions, the party enforcing the collateral protection insurance provision should not treat it as a means to gain a profit. Instead, the party should be careful to charge a reasonable amount that is related to the cost to obtain the insurance.
Contributors
Robert Walker, Esq.
The statutory information was edited and reviewed with the support of MultiState
Become a Content Contributor
The State Law Compendium is made possible through the cooperation, dedication and ongoing efforts of attorney’s who provide and update its statues, cases and comments.
Attorneys who would like to volunteer to develop or update compendium content are welcome to contact us to learn more.