Skip to content

§ 3977. Premiums and interest guaranteed by United States

[Section 407 of the Act.]

(a) GUARANTEE OF PREMIUMS AND INTEREST BY THE UNITED STATES-

(1) GUARANTEE- Payment of premiums, and interest on premiums at the rate specified in section 3976 of this title, which become due on a policy under the protection of this title [sections 541 to 549 of this Appendix] is guaranteed by the United States. If the amount guaranteed is not paid to the insurer before the period of insurance protection under this title expires, the amount due shall be treated by the insurer as a policy loan on the policy.

(2) POLICY TERMINATION- If, at the expiration of insurance protection under this subchapter, the cash surrender value of a policy is less than the amount due to pay premiums and interest on premiums on the policy, the policy shall terminate. Upon such termination, the United States shall pay the insurer the difference between the amount due and the cash surrender value.

(b) RECOVERY FROM INSURED OF AMOUNTS PAID BY THE UNITED STATES-

(1) DEBT PAYABLE TO THE UNITED STATES- The amount paid by the United States to an insurer under this subchapter shall be a debt payable to the United States by the insured on whose policy payment was made.

(2) COLLECTION- Such amount may be collected by the United States, either as an offset from any amount due the insured by the United States or as otherwise authorized by law.

(3) DEBT NOT DISCHARGEABLE IN BANKRUPTCY- Such debt payable to the United States is not dischargeable in bankruptcy proceedings.

(c) CREDITING OF AMOUNTS RECOVERED- Any amounts received by the United States as repayment of debts incurred by an insured under this subchapter shall be credited to the appropriation for the payment of claims under this subchapter.



Banker Tools View All

A collection of useful resources for various areas of the bank which have been developed by members of the BankersOnline staff or have been created and contributed by users of the BankersOnline site.

Banker Tools

Penalties View All

Banker Store View All

From training, policies, forms, and publications, to office products and occasional gifts, it’s available here:

Banker Store

hot right now

image description

Looking for effective, convenient training on a particular subject?

BOL Learning Connect offers more than 200 courses ON-DEMAND or on CD ROM from AML to Reg Z and every topic in between.

Search Regulations

View Regulations

CFPB Letter Classification

FRB Letter Classification