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Which of the following is true regarding the insurance amount in a credit life policy?
AThe amount of coverage can be greater than the amount owed.
BCreditor can only insure the debtor for the amount owed.
CCreditor may insure the debtor for an unlimited amount of coverage.
DAllowable amount of coverage is determined by the State Insurance Commissioner.

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Answer:

(B) Creditor can only insure the debtor for the amount owed.

Explanation:

Credit life policy is a credit life insurance policy arranged to pay off a debtor's outstanding loan if the debtor dies, becomes disabled or unemployed before fully repaying the debt. So the creditor can only insure the debtor for the amount owed in credit life policy.