If bank offers a form of debt cancellation coverage such as GAP insurance, are disclosures prescribed by Reg Z required when customer does NOT purchase insurance? I know that the bank would have to have a signed disclosure when customer opts for insurance and bank does not want to count premium as finance charge, but wasn't sure about instances when customer doesn't purchase insurance.

As far as I know, there are no disclosure requirements when the customer does not purchase the insurance. One of our documents that is signed by the borrower at close does contain a statement that the borrower has elected NOT to purchase insurance, but I don't believe that statement is required by Reg Z.

Thanks for the reply. Our disclosure has the same statement in it and is what caused me to ask the question.