A Bank can require credit life insurance for a loan, but a Bank cannot require that the insurance be purchased from it or any affiliate according to the federal anti-tying laws [12 USC 1972, 12 CFR 225]. The form Federal Credit Application Insurance Disclosure advises the borrower of the prohibition on tying. It must be provided at the time a consumer applies for a loan.
Under Reg B a creditor cannot refuse to extend credit and may not terminate an account because credit life, health, accident, disability, or other credit-related insurance is not available on the basis of the applicant’s age.