(a) An application to the commissioner for a certificate of authority shall be accompanied by the statement and other matters described in this section in the form prescribed by the commissioner. Annually thereafter, within six months after the end of its fiscal period, or within an extension of time therefor, as the commissioner for good cause may grant, the person authorized to engage in the sale of preneed contracts shall file with the commissioner a full and true statement of his or her financial condition, transactions, and affairs, prepared on a basis as adopted by a rule of the commissioner, as of the preceding fiscal period or at such other time or times as the commissioner may provide by rule, together with information and data which may be required by the commissioner.
(b) The statement shall include all of the following:
(1) The types of preneed contracts proposed to be written and the type of funding vehicle to be used.
(2) The name and address of the place of business of the person offering to write preneed contracts.
(3) Evidence that the person offering the statement has the following qualifications:
a. Has the ability to discharge his or her liabilities as they become due in the normal course of business and has sufficient funds available during the calendar year to perform his or her obligations under the contract.
b. Has complied with the trust requirements for the funds received under contracts issued by himself or herself as hereinafter described.
c. Has disbursed interest, dividends, or accretions earned by trust funds, in accordance with this article and rules promulgated hereunder.
d. Has complied with this chapter and any rules of the commissioner.
(4) Any other information considered necessary by the commissioner to meet the commissioner's responsibilities under this chapter.
(c) If the person is an individual, the statement shall be sworn by him or her; if a firm or association, by all members thereof; or, if a corporation, by any officer of the corporation.
(d)(1) An application to the commissioner for an initial certificate of authority shall be accompanied by an application fee in an amount to be determined by the commissioner, not to exceed one hundred fifty dollars ($150). Thereafter, each annual application for renewal of a certificate of authority shall be accompanied by the appropriate fee as determined by the commissioner not to exceed seventy-five dollars ($75).
(2) Any person or entity that is part of a common business enterprise that has a certificate of authority issued pursuant to this article and elects to operate under a name other than that of the common business enterprise shall submit an application on a form adopted by the commissioner to become a branch registrant. Upon the approval of the commissioner that the entity qualifies to sell preneed contracts under this article except for the requirements of paragraph a. of subdivision (3) of subsection (b) and if the certificate holder meets the requirements of paragraph a., a branch registration shall be issued. Each branch registrant may operate under the certificate of authority of the common business enterprise upon the payment of a fee established by the commissioner not to exceed one hundred fifty dollars ($150) accompanying the application on July 1 annually.
(e) Upon the commissioner being satisfied that the statement and matters which may accompany it meet the requirements of this article and of its rules, the commissioner shall issue or renew the certificate of authority.
(f) The certificate of authority shall expire annually on September 1, unless renewed, or at such other time or times as the commissioner may provide by rule.
(g) On or before July 1 of each year, the certificate holder shall file with the commissioner in the form prescribed by the commissioner a full and true statement as to the activities of any trust established by it pursuant to this article for the preceding calendar year.
(h) In addition to any other penalty that may be provided for under this article, the commissioner may levy a fine not to exceed fifty dollars ($50) per day for each day the certificate holder fails to file its annual statement, and the commissioner may levy a fine not to exceed fifty dollars ($50) per day for each day the certificate holder fails to file the statement of activities of the trust. Upon notice to the certificate holder by the commissioner that the certificate holder has failed to file the annual statement or the statement of activities of the trust, the certificate holder's authority to sell preneed contracts shall cease while the default continues.
(i) To facilitate uniformity in financial statements and to facilitate analysis, the commissioner may by rule adopt a form for financial statements. The holder of a certificate of authority may submit a written request to the commissioner to exempt the holder from filing financial statements at renewal. The commissioner may waive the requirement for filing a financial statement at renewal if all of the following are satisfied:
(1) No valid complaint has been filed since the last examination.
(2) No administrative action against the preneed entity has been instituted since the last examination.
(3) The certificate holder certifies that all outstanding preneed contracts written by the holder since April 30, 2002, are fully funded in accordance with this chapter.
(4) The certificate holder certifies that it will fully fund all preneed contracts with life insurance, annuity, or will deposit 100 percent of all funds collected on all preneed contracts in trust within 30 days after the end of the calendar month in which the funds are collected.
(5) The preneed entity has provided to the department in a timely manner all required and requested records.
(6) The preneed entity agrees to file quarterly reports of its preneed activity on a form or in a format prescribed by the commissioner.
(j) The commissioner may authorize the transfer of certificates of authority and establish fees for the transfer in an amount not to exceed one hundred dollars ($100). Upon receipt of an application for transfer, the commissioner may grant a temporary certificate of authority to the proposed transferee, based upon criteria established by the commissioner by rule, which criteria shall promote the purposes of this article in protecting the consumer. A temporary certificate of authority shall expire 60 days after issuance unless renewed by the commissioner.
Last modified: May 3, 2021