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2136Ratification Number: 58Act Number: 37Introducing Body: HouseSubject: Service charges by insurance premium service companies
(A37, R58, H2136)
AN ACT TO AMEND SECTION 38-27-90, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO SERVICE CHARGES BY INSURANCE PREMIUM SERVICE COMPANIES AND PROHIBITIONS AGAINST THOSE COMPANIES, SO AS TO PROVIDE THAT PARTIES MAY CONTRACT FOR A SERVICE CHARGE AT ANY RATE WITH RESPECT TO A PREMIUM SERVICE AGREEMENT WHICH IS FOR OTHER THAN PERSONAL, FAMILY, OR HOUSEHOLD PURPOSES, TO PROVIDE THAT NO RATE CHARGED MAY BE UNCONSCIONABLE, AND TO DEFINE UNCONSCIONABLE.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Subsection (e) of Section 38-27-90 of the 1976 Code, as last amended by Act 455 of 1980, is further amended to read:
"(e) The service charge is at the rate of one percent per month computed on the remainder of the outstanding balance. However, in the event of cancellation by the borrower prior to maturity of the contract, the unearned service charge must be refunded on a short rate basis as determined by the commission. With respect to the service charge for a premium service agreement which is for other than personal, family, or household purposes, the parties may contract for the payment by the debtor of a service charge at any rate, provided that no rate charged hereunder may be unconscionable, which is defined as a rate substantially exceeding the usual and customary charge for financing insurance premiums."
SECTION 2. This act shall take effect upon approval by the Governor.