TN HB0772

Premium finance company licensees may impose convenience fees on insureds paying by credit card, debit card, electronic funds transfer, electronic check, or other electronic means to offset actual processing costs

Convenience fees must not exceed actual third-party processing costs, though licensees may charge an average cost across payment types; if the licensee is a subsidiary of a payment processor, parent entity costs qualify as third-party costs

Licensees must notify insureds of the fee amount before completing transactions, allow cancellation without fee, and provide a fee-free payment option via check, cash, or money order

Convenience fees are non-refundable once an insured elects electronic payment, and no convenience fee may be charged on debit or prepaid card transactions if prohibited by the payment card network's rules

Handling charges for dishonored payments (bounced checks, failed electronic transfers) are permitted under § 47-29-102, limited to one charge per dishonored item; these charges are excluded from usury law calculations