# Tenn. Code Ann. § 56-49-110: Payment in event of loss

> Tennessee · Statutes · In force

URL: https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-110

## Section

- **Citation:** Tenn. Code Ann. § 56-49-110
- **Heading:** Payment in event of loss
- **Jurisdiction:** Tennessee
- **Kind:** Statutes
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** TN Code / Title 56 / Chapter 49 / Section 56-49-110

## Text

(a) In the event of a loss under the creditor-placed insurance policy, the insurer shall pay, at a minimum, the least of the following, the value of which shall be determined as of the date of loss: (1) The cost to repair the collateral less any applicable deductible; (2) The actual cash value of the collateral less any applicable deductible; (3) The net debt, less any applicable deductible. The method of calculation of net debt payable pursuant to this subdivision (a)(3) shall be identical to the method of calculation of net debt for payment of premiums pursuant to § 56-49-105(a) ; or (4) If single interest insurance is provided, the amount by which the creditor's interest is impaired. (b) The net debt or actual cash value amounts in subsection (a) may be reduced by the value of salvage if the insurer does not take possession of the insured property. (c) In the event of a loss, no subrogation shall run against the debtor from the insurer. (d) Whenever a claim is made on a creditor-placed insurance policy, the insurer shall furnish to the claimant a written statement of the loss explaining the settlement amount and the method of settlement. (e) A creditor or insurer may not abandon salvage to a towing or storage facility in lieu of payment of storage fees without the consent of the facility and the claimant. The insurer shall be responsible for the payment of towing and storage charges for a covered loss occurrence from the time the claim is reported to the insurer in accordance with the terms of the policy to the time the claim is paid. The insurer shall give written notice to the claimant when the claim is paid that the claimant may incur storage charges after the date the claim is paid. Acts 1999, ch. 144, § 10.
(a) In the event of a loss under the creditor-placed insurance policy, the insurer shall pay, at a minimum, the least of the following, the value of which shall be determined as of the date of loss: (1) The cost to repair the collateral less any applicable deductible; (2) The actual cash value of the collateral less any applicable deductible; (3) The net debt, less any applicable deductible. The method of calculation of net debt payable pursuant to this subdivision (a)(3) shall be identical to the method of calculation of net debt for payment of premiums pursuant to § 56-49-105(a) ; or (4) If single interest insurance is provided, the amount by which the creditor's interest is impaired.
(1) The cost to repair the collateral less any applicable deductible;
(2) The actual cash value of the collateral less any applicable deductible;
(3) The net debt, less any applicable deductible. The method of calculation of net debt payable pursuant to this subdivision (a)(3) shall be identical to the method of calculation of net debt for payment of premiums pursuant to § 56-49-105(a) ; or
(4) If single interest insurance is provided, the amount by which the creditor's interest is impaired.
(b) The net debt or actual cash value amounts in subsection (a) may be reduced by the value of salvage if the insurer does not take possession of the insured property.
(c) In the event of a loss, no subrogation shall run against the debtor from the insurer.
(d) Whenever a claim is made on a creditor-placed insurance policy, the insurer shall furnish to the claimant a written statement of the loss explaining the settlement amount and the method of settlement.
(e) A creditor or insurer may not abandon salvage to a towing or storage facility in lieu of payment of storage fees without the consent of the facility and the claimant. The insurer shall be responsible for the payment of towing and storage charges for a covered loss occurrence from the time the claim is reported to the insurer in accordance with the terms of the policy to the time the claim is paid. The insurer shall give written notice to the claimant when the claim is paid that the claimant may incur storage charges after the date the claim is paid.
Acts 1999, ch. 144, § 10.

## Nearby sections

- [Tenn. Code Ann. § 56-49-101 Short title - Purpose](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-101.md)
- [Tenn. Code Ann. § 56-49-102 Applicability - Enforcement](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-102.md)
- [Tenn. Code Ann. § 56-49-103 Chapter definitions](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-103.md)
- [Tenn. Code Ann. § 56-49-104 Effective dates of insurance - Insurance charges](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-104.md)
- [Tenn. Code Ann. § 56-49-105 Premium rates](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-105.md)
- [Tenn. Code Ann. § 56-49-106 Exclusion from coverage](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-106.md)
- [Tenn. Code Ann. § 56-49-107 Policy delivery to debtor](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-107.md)
- [Tenn. Code Ann. § 56-49-108 Commissioner approval of forms and rates](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-108.md)
- [Tenn. Code Ann. § 56-49-109 Refund of unearned premiums and charges](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-109.md)
- [Tenn. Code Ann. § 56-49-110 Payment in event of loss](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-110.md)
- [Tenn. Code Ann. § 56-49-111 Creditor right to require insurance](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-111.md)
- [Tenn. Code Ann. § 56-49-112 Premium remittance - Commissions](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-112.md)
- [Tenn. Code Ann. § 56-49-113 Disclosure of insurance requirement](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-113.md)
- [Tenn. Code Ann. § 56-49-114 Investigations - Hearings and proceedings - Penalties for violations](https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-114.md)

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/STATE_TN_T56_C49_S56-49-110. Check the current official text before relying on it. Not legal advice.