1. The amount, if any, included in any retail installment transaction for insurance, if a separate identified charge is made for the insurance, which insurance may be purchased by the holder of the contract, shall not exceed the applicable premiums chargeable in accordance with the rates approved by the department of commerce and insurance of this state where the rates are required by law to be approved by the department. All insurance shall be written by an insurance company authorized to do business in this state and all policies written in this state shall be countersigned by a duly licensed resident agent authorized to engage in the insurance business in this state, unless otherwise provided by law. A buyer may be required to provide insurance on the motor vehicle at his own cost for the protection of the seller or holder, as well as the buyer, but the insurance shall be limited to insurance against substantial risk of loss, damage or destruction of the motor vehicle. Any other insurance, including insurance providing involuntary unemployment coverage, may be included in a retail installment transaction at the buyer’s expense only if contracted for voluntarily by the buyer. If the insurance for which the identified charge is made insures the safety or health of the buyer or his interest in the motor vehicle and is purchased by the holder, it shall be subject to the limitations provided for in the regulations promulgated and issued by the director pursuant to the provision of subsection 1 of section 365.060. The holder shall within thirty days after the execution of the retail installment contract send or cause to be sent to the buyer a policy or certificate of insurance, clearly setting forth the amount of the cost of the policy or certificate of insurance, the kinds of insurance, and, if a policy, all the terms, exceptions, limitations, restrictions and conditions of the contract of insurance, or, if a certificate, a summary of the certificate. The seller shall not decline existing insurance written by an insurance company authorized to do business in this state and the buyer shall have the privilege of purchasing insurance from an agent or broker of his own selection and of selecting his insurance company; except, that the insurance company shall be acceptable to the holder, and further, that the inclusion of the cost of the insurance in the retail installment contract when the buyer selects his agent, broker or company, shall be optional with the seller.

2. If any insurance is cancelled, or the premium adjusted, any refund of the insurance premium received by the holder shall be credited to the final maturing installments of the contract except to the extent applied toward payment for similar insurance protecting the interests of the buyer and the holder or either of them.

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3. The amount of any life insurance shall not exceed the amount of the total unpaid balance from time to time; except, that where the buyer’s obligation is repayable in payments which are not substantially equal in amount, the insurance may be level term insurance in an amount which shall not exceed by more than five dollars the time balance as determined under subsection 6 of section 365.070.

4. Nothing in this chapter shall be construed to prohibit the sale of a deficiency waiver addendum, guaranteed asset protection, extended service contract, or other similar products purchased at the time of sale, as part of a retail sale transaction involving any motor vehicle, or including the cost therefor within a retail installment transaction, provided the requirements of section 365.070 are met.