Sec. 14.07.02.04. Payment of Premium

A. Payment of the full annual premium to MAIF or the fund producer may be made in any commercially acceptable form, except that payment to MAIF may not be made by personal check of the applicant.

B. If a premium finance company provides any part of the full annual premium due, the fund producer shall also submit to MAIF with the completed application a fully completed, signed, and dated premium finance agreement. The agreement shall be satisfied according to its terms as of the binding date, including but not limited to payment of the premium deposit required by the agreement.

C. The fund producer shall submit a separate premium payment due with each application or notice of change.

D. Endorsements.

(1) Endorsements need not be submitted with the premium unless:

(a) They are submitted within 90 days of the expiration date of the policy; and

(b) The endorsement either adds a vehicle or coverage to the policy, increases the physical damage rate, or adds a driver to the policy which would change the point surcharge or driver class.

(2) Premium for the endorsements may be prorated for the balance of the policy term.

E. If an applicant's initial payment of premium is dishonored, there is no binding of coverage and any policy or endorsement issued in reliance on the dishonored payment is void. If an applicant's initial premium payment is less than that required by the applicant's premium financing agreement, there is no binding of coverage in MAIF until the initial amount required by the agreement is fully paid to the fund producer and all other binding procedures are complete.

F. The fund producer shall advise each applicant in a format to be developed and furnished by MAIF that the payment of premium finance installments under a premium finance agreement is not payment of premium to MAIF and is not evidence of the receipt of premium by MAIF.