PARRIS N. GLENDENING, Governor                                   Ch. 36

In item (5) of this section, the former reference to a "possible" settlement is
deleted as surplusage.

Defined terms: "Insurer" § 1-101
"Policy" § 1-101

12-106. BINDERS OR CONTRACTS FOR TEMPORARY INSURANCE.

(A)     SCOPE OF SECTION.

THIS SECTION DOES NOT APPLY TO LIFE INSURANCE OR HEALTH INSURANCE.

(B)     IN GENERAL.

A BINDER OR OTHER CONTRACT FOR TEMPORARY INSURANCE:

(1)      MAY BE MADE ORALLY OR IN WRITING; AND

(2)      EXCEPT AS SUPERSEDED BY THE CLEAR AND EXPRESS TERMS OF
THE BINDER, IS CONSIDERED TO INCLUDE:

(I)       ALL THE USUAL TERMS OF THE POLICY AS TO WHICH THE
BINDER WAS GIVEN; AND

(II)     THE APPLICABLE ENDORSEMENTS DESIGNATED IN THE
BINDER.

(C)     EXTENT OF VALIDITY.

A BINDER IS NO LONGER VALID AFTER THE POLICY AS TO WHICH IT WAS
GIVEN IS ISSUED.

(D)     BINDERS GIVEN TO CONSUMER BORROWER.

(1) IF A BINDER IS GIVEN TO A CONSUMER BORROWER TO SATISFY A
LENDER'S REQUIREMENT THAT THE BORROWER OBTAIN PROPERTY INSURANCE OR
CREDIT LOSS INSURANCE AS A CONDITION OF MAKING A LOAN SECURED BY A FIRST
MORTGAGE OR FIRST DEED OF TRUST ON AN INTEREST IN OWNER-OCCUPIED
RESIDENTIAL REAL PROPERTY, THE INSURER OR ITS AGENT SHALL INCLUDE IN OR
WITH THE BINDER:

(I)       THE NAME AND ADDRESS OF THE INSURED CONSUMER
BORROWER;

(II)     THE NAME AND ADDRESS OF THE LENDER;

(III)   A DESCRIPTION OF THE INSURED RESIDENTIAL REAL
PROPERTY;

(IV)    A PROVISION THAT THE BINDER MAY NOT BE CANCELED
WITHIN THE TERM OF THE BINDER UNLESS THE LENDER AND THE INSURED
BORROWER RECEIVE WRITTEN NOTICE AT LEAST 10 DAYS BEFORE THE
CANCELLATION;

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