Afco Finance Agreement

The IPFCA regulates insurance premium finance companies that are “active in the conclusion of insurance premium financing contracts.”   RCW 48.56.020 (1).   A “premium financing agreement” is: Cananwill argues, and we agree that this legal language allows premium finance companies to calculate “add-on” interest instead of simple interest rates on lowering the premium loan balance. (Added highlight)   See also RCW 48.56.090 (3): Service charges are $10 maximum per hundred dollars per year, plus a purchase fee of $10 per premium financing agreement that must not be refunded in case of cancellation or advance. Although RDI argues differently, we conclude that only the $10 purchase fee in the event of cancellation or down payment should not be refunded.   In interpreting this sentence as not having to be reimbursed, neither the interest not earned nor the purchase fee of USD 10 in the event of cancellation or down payment, this would be contrary to the rules of repayment of RCW 48.56.120.   We also note that RCW 48.56.080 (5) provides that “[p]remiums advanced by a premium financing company are funds that belong to the insured and are maintained in a fiduciary relationship.”   The premium finance company has a security interest in unearned premiums due to the assignment cancelled in the premium financing contract pursuant to RCW 48.56.020 (2).   However, it shall receive any reimbursement of undeserved premiums “on behalf of policyholders or policyholders” pursuant to section 48.56.120 (1) and must credit return premiums “in the insured`s account” with repayment of a surplus in dollars or more of the amount owed by the insured to the insured in accordance with RCW 48.56.120 (2).   None of these provisions is consistent with RDI`s proposed interpretation of RCW 48.56.090 (3). Phone: (877) 701-1212Email: Premium Finance Agreement” refers to an agreement by which an insured or potential insured promises to pay an insurance premium financier the amount that will be advanced or advanced under the agreement to an insurer or insurance producer in the event of payment of premiums for an insurance policy, accompanied by a financing commission. In May 2000, RDI filed a class action, Cananwill allegedly violated the Washington IPFCA and similar laws in other states where Cananwill was doing business by charging its customers service fees above the ceiling allowed by those laws, and further asserts that Cananwill`s conduct is an unfair or misleading act or practice contrary to the Washington Consumer Protection Act (CPA) and similar consumer protection laws in other states.

  The parties agreed that prior to RDI`s attempt to certify the class, there was a request for a summary assessment on the limited issues of whether Cananwill`s premium funding agreement with RDI was contrary to the Washington IPFCA and whether the alleged violation was achievable under the WashtoNer CPA. As a result, the parties submitted their cross-claims on September 10, 2001.   On October 12, 2001, a King County Superior Court judge dismissed RDI`s request for a summary decision and granted Cananwill`s request for a summary decision and dismissed RDI`s entire appeal.