reglab/statecodes huggingface dataset:
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111 - Accelerated Term Life Insurance Benefits › Subchapter B. Accelerated Term Life Insurance Benefits › Section 1111.052. Authority to Pay Accelerated Term Life Benefits

Sec. 1111.052.  AUTHORITY TO PAY ACCELERATED TERM LIFE BENEFITS.  An insurer may pay an accelerated benefit under an individual or group term life insurance policy or certificate if:
(1)  the insurer has received a written medical opinion, satisfactory to the insurer, that the insured has:
(A)  a terminal illness;
(B)  a long-term care illness;  or
(C)  an illness or physical condition that is likely to cause permanent disability or premature death, including:
(i)  acquired immune deficiency syndrome (AIDS);
(ii)  a malignant tumor;
(iii)  a condition that requires an organ transplant;  or
(iv)  a coronary artery disease that results in acute infarction or requires surgery;  and
(2)  the amount of the accelerated benefit is deducted from:
(A)  the amount of the death benefit payable under the policy or certificate;  and
(B)  any amount the insured would otherwise be entitled to convert to an individual contract.
Added by Acts 2001, 77th Leg., ch. 1419, Sec. 2, eff. June 1, 2003.  Amended by Acts 2003, 78th Leg., ch. 1276, Sec. 10A.302, eff. Sept. 1, 2003.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111 - Accelerated Term Life Insurance Benefits › Subchapter B. Accelerated Term Life Insurance Benefits › Section 1111.053. Rules

Sec. 1111.053.  RULES.  The commissioner may adopt rules to implement this subchapter.
Added by Acts 2001, 77th Leg., ch. 1419, Sec. 2, eff. June 1, 2003.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.001. Short Title

Sec. 1111A.001.  SHORT TITLE.  This Act may be cited as the Life Settlements Act.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.004. License Suspension, Revocation, or Refusal to Renew

Sec. 1111A.004.  LICENSE SUSPENSION, REVOCATION, OR REFUSAL TO RENEW.  (a)  The commissioner may suspend, revoke, or refuse to renew the license of a license holder if the commissioner finds that:
(1)  there was a material misrepresentation in the application for the license;
(2)  the license holder or an officer, partner, member, or director of the license holder has been guilty of fraudulent or dishonest practices, is subject to a final administrative action, or is otherwise shown to be untrustworthy or incompetent to act as a license holder;
(3)  the license holder is a provider and demonstrates a pattern of unreasonably withholding payments to policy owners;
(4)  the license holder no longer meets the requirements for initial licensure;
(5)  the license holder or any officer, partner, member, or director of the license holder has been convicted of a felony, or of any misdemeanor with respect to which criminal fraud is an element, or has pleaded guilty or nolo contendere with respect to a felony or a misdemeanor with respect to which criminal fraud or moral turpitude is an element, regardless of whether a judgment of conviction has been entered by the court;
(6)  the license holder is a provider and has entered into a life settlement contract using a form that has not been approved under this chapter;
(7)  the license holder is a provider and has failed to honor contractual obligations in a life settlement contract;
(8)  the license holder is a provider and has assigned, transferred, or pledged a settled policy to a person other than a provider licensed in this state, a purchaser, an accredited investor or qualified institutional buyer as defined respectively in 17 C.F.R. Section 230.144A, as amended, a financing entity, a special purpose entity, or a related provider trust; or
(9)  the license holder or any officer, partner, member, or key management personnel of the license holder has violated this chapter.
(b)  The commissioner may deny a license application or suspend, revoke, or refuse to renew the license of a license holder in accordance with Chapter 2001, Government Code.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.005. Requirements for Contract Forms, Disclosure Forms, and Advertisements

Sec. 1111A.005.  REQUIREMENTS FOR CONTRACT FORMS, DISCLOSURE FORMS, AND ADVERTISEMENTS.  (a)  A person may not use any form of life settlement contract in this state unless the form has been filed with and approved, if required, by the commissioner in a manner that conforms with the filing procedures and any time restrictions or deeming provisions for life insurance forms, policies, and contracts.
(b)  An insurer may not, as a condition of responding to a request for verification of coverage or in connection with the transfer of a policy pursuant to a life settlement contract, require that the owner, insured, provider, or broker sign any form, disclosure, consent, waiver, or acknowledgment that has not been expressly approved by the commissioner for use in connection with life settlement contracts.
(c)  A person may not use a life settlement contract form or provide to an owner a disclosure statement form unless the form is first filed with and approved by the commissioner.  The commissioner shall disapprove a life settlement contract form or disclosure statement form if, in the commissioner's opinion, the contract or contract provisions fail to meet the requirements of Sections 1111A.011, 1111A.012, 1111A.014, and 1111A.023(b), or are unreasonable, contrary to the interests of the public, or otherwise misleading or unfair to the owner.
(d)  At the commissioner's discretion, the commissioner may require the submission of advertisements.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.007. Examination

Sec. 1111A.007.  EXAMINATION.  Subchapter B, Chapter 401, applies to a person engaged in the business of life settlements.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.008. Immunity From Liability

Sec. 1111A.008.  IMMUNITY FROM LIABILITY.  (a)  No cause of action shall arise nor shall any liability be imposed against the commissioner, the commissioner's authorized representatives, or any examiner appointed by the commissioner for a statement made or conduct performed in good faith while carrying out this chapter.
(b)  No cause of action shall arise, nor shall any liability be imposed against any person for the act of communicating or delivering information to the commissioner or the commissioner's authorized representative or examiner pursuant to an examination made under this chapter, if the act of communication or delivery was performed in good faith and without fraudulent intent or the intent to deceive.  This subsection does not abrogate or modify in any way any common law or statutory privilege or immunity enjoyed by any person identified in Subsection (a).
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.009. Investigative Authority of the Commissioner

Sec. 1111A.009.  INVESTIGATIVE AUTHORITY OF THE COMMISSIONER.  The commissioner may investigate a suspected fraudulent life settlement act and a person engaged in the business of life settlements.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.010. Cost of Examinations

Sec. 1111A.010.  COST OF EXAMINATIONS.  The reasonable and necessary cost of an examination under this chapter is to be assessed against the person being examined in accordance with Section 751.208.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.011. Advertising

Sec. 1111A.011.  ADVERTISING.  (a)  A broker or provider licensed pursuant to this chapter may conduct or participate in an advertisement in this state.  The advertisement must comply with all advertising and marketing laws under Chapter 541 and rules adopted by the commissioner that are applicable to life insurers or to license holders under this chapter.
(b)  Advertisements shall be accurate, truthful, and not misleading in fact or by implication.
(c)  A person may not:
(1)  market, advertise, solicit, or otherwise promote the purchase of a policy for the sole purpose of or with an emphasis on settling the policy; or
(2)  use the words "free," "no cost," or words of similar import in the marketing, advertising, or soliciting of, or otherwise promoting, the purchase of a policy.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.013. Disclosure to Insurer

Sec. 1111A.013.  DISCLOSURE TO INSURER.  (a)  Without limiting the ability of an insurer to assess the insurability of a policy applicant and to determine whether to issue the policy, and in addition to other questions an insurance carrier may lawfully pose to a life insurance applicant, an insurer may inquire in the application for insurance whether the proposed owner intends to pay premiums with the assistance of financing from a lender that will use the policy as collateral to support the financing.
(b)  If, as described in Sections 1111A.002(11) and (11-A), the loan provides funds that can be used for a purpose other than paying for the premiums, costs, and expenses associated with obtaining and maintaining the life insurance policy and loan, and notwithstanding any other law, the application must be rejected as a violation of Section 1111A.017.
(c)  If the financing does not violate Section 1111A.017, the insurance carrier:
(1)  may make disclosures, not later than the date of the delivery of the policy, to the applicant and the insured, either on the application or on an amendment to the application that include the following or substantially similar statements:
"If you have entered into a loan arrangement in which the policy is used as collateral, and the policy does change ownership at some point in the future in satisfaction of the loan, the following may be true:
(A)  a change of ownership could lead to a stranger owning an interest in the insured's life;
(B)  a change of ownership could in the future limit your ability to purchase future insurance on the insured's life because there is a limit to how much coverage insurers will issue on one life;
(C)  should there be a change of ownership and you wish to obtain more insurance coverage on the insured's life in the future, the insured's higher issue age, a change in health status, or other factors may reduce the ability to obtain coverage or may result in significantly higher premiums; and
(D)  you should consult a professional advisor, since a change in ownership in satisfaction of the loan may result in tax consequences to the owner, depending on the structure of the loan.";
(2)  may require certifications, such as the following, from the applicant or the insured:
(A)  "I have not entered into any agreement or arrangement providing for the future sale of this life insurance policy";
(B)  "My loan arrangement for this policy provides funds sufficient to pay for some or all of the premiums, costs, and expenses associated with obtaining and maintaining my life insurance policy, but I have not entered into any agreement by which I am to receive consideration in exchange for procuring this policy"; and
(C)  "The borrower has an insurable interest in the insured."
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.015. Authority to Adopt Rules

Sec. 1111A.015.  AUTHORITY TO ADOPT RULES.  (a)  The commissioner may adopt rules implementing this chapter and regulating the activities and relationships of providers, brokers, insurers, and their authorized representatives.
(b)  The commissioner may not adopt a rule establishing a price or fee for the sale or purchase of a life settlement contract.  This subsection does not prohibit the commissioner from adopting a rule relating to an unjust price or fee for the sale or purchase of a life settlement contract.
(c)  The commissioner may not adopt a rule that regulates the actions of an investor providing money to a life or viatical settlement company.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.016. Conflict of Laws

Sec. 1111A.016.  CONFLICT OF LAWS.  (a)  If there is more than one owner on a single policy, and the owners are residents of different states, the life settlement contract is governed by the law of the state in which the owner having the largest percentage ownership resides or, if the owners hold equal ownership, the state of residence of one owner agreed on in writing by all of the owners.  The law of the state of the insured shall govern in the event that equal owners fail to agree in writing on a state of residence for jurisdictional purposes.
(b)  A provider licensed in this state who enters into a life settlement contract with an owner who is a resident of another state that has enacted statutes or adopted rules governing life settlement contracts is governed in the effectuation of that life settlement contract by the statutes and rules of the owner's state of residence.  If the state in which the owner is a resident has not enacted statutes or adopted rules governing life settlement contracts, the provider shall give the owner notice that neither state regulates the transaction on which the owner is entering.  For transactions in those states, however, the provider shall maintain all records required by this chapter if the transactions were executed in this state.  The forms used in those states need not be approved by the department.
(c)  If there is a conflict in the laws that apply to an owner and a purchaser in any individual transaction, the laws of the state that apply to the owner shall take precedence and the provider shall comply with those laws.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.018. Fraud Prevention and Control

Sec. 1111A.018.  FRAUD PREVENTION AND CONTROL.  (a)  A person may not commit a fraudulent life settlement act.
(b)  A person may not interfere with the enforcement of this chapter or an investigation of a suspected or actual violation of this chapter.
(c)  A person in the business of life settlements may not knowingly or intentionally permit a person convicted of a felony involving dishonesty or breach of trust to participate in the business of life settlements.
(d)  A life settlement contract and an application for a life settlement contract, regardless of the form of transmission, must contain the following, or a substantially similar, statement:  "Any person who knowingly presents false information in an application for insurance or a life settlement contract is guilty of a crime and may be subject to fines and confinement in prison."
(e)  The failure to include a statement as required in Subsection (d) is not a defense in any prosecution for a fraudulent life settlement act.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.019. Mandatory Reporting of Fraudulent Life Settlement Acts

Sec. 1111A.019.  MANDATORY REPORTING OF FRAUDULENT LIFE SETTLEMENT ACTS.  A person engaged in the business of life settlements has a duty under Section 701.051 to report a fraudulent life settlement act.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.020. Confidentiality

Sec. 1111A.020.  CONFIDENTIALITY.  (a)  The documents and evidence obtained by the commissioner in an investigation of a suspected or an actual fraudulent life settlement act are privileged and confidential, are not a public record, and are not subject to discovery or subpoena in a civil or criminal action.
(b)  Subsection (a) does not prohibit release by the commissioner of documents and evidence obtained in an investigation of a suspected or an actual fraudulent life settlement act:
(1)  in an administrative or judicial proceeding to enforce a provision of this code or another insurance law of this state;
(2)  to a federal, state, or local law enforcement or regulatory agency, to an organization established for the purpose of detecting and preventing a fraudulent life settlement act, or to the National Association of Insurance Commissioners; or
(3)  at the discretion of the commissioner, to a person in the business of life settlements that is aggrieved by a fraudulent life settlement act.
(c)  Release of documents and evidence under Subsection (b) does not abrogate or modify the privilege granted in Subsection (a).
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.021. Other Law Enforcement or Regulatory Authority

Sec. 1111A.021.  OTHER LAW ENFORCEMENT OR REGULATORY AUTHORITY.  This chapter does not:
(1)  preempt the authority or relieve the duty of another law enforcement or regulatory agency to investigate, examine, and prosecute a suspected violation of law;
(2)  preempt, supersede, or limit any provision of any state securities law or any rule, order, or notice issued under the law;
(3)  prevent or prohibit a person from disclosing voluntarily information concerning life settlement fraud to a law enforcement or regulatory agency other than the department; or
(4)  limit the powers granted by the laws of this state to the commissioner or an insurance fraud unit to investigate and examine a possible violation of law and to take appropriate action against wrongdoers.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.022. Life Settlement Antifraud Initiatives

Sec. 1111A.022.  LIFE SETTLEMENT ANTIFRAUD INITIATIVES.  (a)  A provider or broker shall implement antifraud initiatives reasonably calculated to detect, prosecute, and prevent fraudulent life settlement acts.  At the discretion of the commissioner, the commissioner may order, or a license holder may request and the commissioner may grant, a modification of the following required initiatives as necessary to ensure an effective antifraud program.  A modification granted under this section may be more or less restrictive than the required initiatives so long as the modification may reasonably be expected to accomplish the purpose of this section.  Antifraud initiatives must include:
(1)  fraud investigators, who may be provider or broker employees or independent contractors; and
(2)  an antifraud plan, which must be submitted to the commissioner and must include:
(A)  a description of the procedures for detecting and investigating possible fraudulent life settlement acts and procedures for resolving material inconsistencies between medical records and insurance applications;
(B)  a description of the procedures for reporting possible fraudulent life settlement acts to the commissioner;
(C)  a description of the plan for antifraud education and training of underwriters and other personnel; and
(D)  a description or chart outlining the organizational arrangement of the antifraud personnel who are responsible for the investigation and reporting of possible fraudulent life settlement acts and investigating unresolved material inconsistencies between medical records and insurance applications.
(b)  An antifraud plan submitted to the commissioner is privileged and confidential, is not subject to disclosure under Chapter 552, Government Code, and is not subject to discovery or subpoena in a civil action.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.023. Injunction; Civil Remedies; Cease and Desist Orders

Sec. 1111A.023.  INJUNCTION; CIVIL REMEDIES; CEASE AND DESIST ORDERS.  (a)  In addition to the penalties and other enforcement provisions of this chapter, if any person violates this chapter or any rule implementing this chapter, the commissioner may seek an injunction in a court in the county where the person resides or has a principal place of business and may apply for temporary and permanent orders that the commissioner determines necessary to restrain the person from further committing the violation.
(b)  The commissioner may issue a cease and desist order against a person who violates any provision of this chapter, any rule or order adopted by the commissioner, or any written agreement entered into with the commissioner, in accordance with Chapter 82.
(c)  If the commissioner finds that an action in violation of this chapter presents an immediate danger to the public and requires an immediate final order, the commissioner may issue an emergency cease and desist order under Chapter 83.
(d)  The provisions of this chapter may not be waived by agreement.  No choice of law provision may prevent the application of this chapter to any settlement.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.024. Penalties

Sec. 1111A.024.  PENALTIES.  (a)  It is a violation of this chapter for any person, provider, broker, or any other party related to the business of life settlements to commit a fraudulent life settlement act.
(b)  A person who knowingly, recklessly, or intentionally commits a fraudulent life settlement act commits a criminal offense and is subject to penalties under Chapter 35, Penal Code.
(c)  Subtitle B, Title 2, applies to a violation of this chapter.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.025. Applicability of Other Insurance Laws

Sec. 1111A.025.  APPLICABILITY OF OTHER INSURANCE LAWS.  The following laws apply to a person engaged in the business of life settlements:
(1)  Chapters 82, 83, 84, 101, 481, and 701;
(2)  Sections 31.002, 32.021, 32.023, 32.041, 38.001, 81.004, 86.001, 86.051, 86.052, 201.004, 401.051, 401.054, 401.151(a), 521.003, 521.004, 543.001(c), 801.056, and 862.052;
(3)  Subchapter A, Chapter 32;
(4)  Subchapter C, Chapter 36;
(5)  Subchapter B, Chapter 404; and
(6)  Subchapter B, Chapter 491.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1111A - Life Settlement Contracts › Section 1111A.026. Applicability of Certain Provisions to Life Expectancy Estimators

Sec. 1111A.026.  APPLICABILITY OF CERTAIN PROVISIONS TO LIFE EXPECTANCY ESTIMATORS.  (a) The following provisions do not apply to a broker who acts solely as a life expectancy estimator:
(1)  Section 1111A.003(p);
(2)  Section 1111A.012; and
(3)  Sections 1111A.014(l) and (m).
(b)  The commissioner may exempt a broker who acts only as a life expectancy estimator from other provisions of this chapter if the commissioner finds that the application of those provisions to the broker is not necessary for the public welfare.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 3, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1112 - Certain Guarantees in Life Insurance Policies › Section 1112.001. Certain Guarantees Not Prohibited

Sec. 1112.001.  CERTAIN GUARANTEES NOT PROHIBITED.  Section 841.253 does not prohibit the issuance of a life insurance policy that guarantees, by coupons or otherwise, definite payments or reductions in premiums.
Added by Acts 2007, 80th Leg., R.S., Ch. 730 (H.B. 2636), Sec. 1F.001, eff. April 1, 2009.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1112 - Certain Guarantees in Life Insurance Policies › Section 1112.002. Certain Guarantees Constitute Definite Contract Benefit; Valuation of Benefit

Sec. 1112.002.  CERTAIN GUARANTEES CONSTITUTE DEFINITE CONTRACT BENEFIT; VALUATION OF BENEFIT.  (a)  Except as provided by Subsection (e), a guarantee described by Section 1112.001 that is in a policy or coupon issued after September 5, 1955, shall be treated as a definite contract benefit and valued according to this section and the reserve requirements of Chapter 425.
(b)  Except as provided by Subsection (c), for a policy or coupon issued before the date determined under Section 1105.002(a) or (b), as applicable to the company, a contract benefit described by Subsection (a) shall be valued using the reserve valuation net premium for the benefits that is a uniform percentage of the gross premiums.
(c)  A policy described by Subsection (b) that contains a contract benefit described by Subsection (a) may be valued on a basis that provides for not more than one year preliminary term insurance.
(d)  For a policy or coupon issued on or after the date determined under Section 1105.002(a) or (b), as applicable to the company, a contract benefit described by Subsection (a) shall be valued using the commissioners reserve valuation method described by Section 425.064.
(e)  A provision of this section relating to reserves does not apply to a policy issued before September 7, 1955.
Added by Acts 2007, 80th Leg., R.S., Ch. 730 (H.B. 2636), Sec. 1F.001, eff. April 1, 2009.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1113 - Management, Control, and Disposition of Certain Life Insurance and Annuity Contracts › Section 1113.001. Life Insurance and Annuity Contracts of Spouse

Sec. 1113.001.  LIFE INSURANCE AND ANNUITY CONTRACTS OF SPOUSE.  A spouse, without the joinder or consent of the other spouse, has management, control, and disposition of any contract of life insurance or annuity issued in the spouse's name or to the extent provided by the contract or any assignment of the contract, regardless of whether the contract was issued before, on, or after January 1, 1968.
Added by Acts 2007, 80th Leg., R.S., Ch. 730 (H.B. 2636), Sec. 1F.001, eff. April 1, 2009.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter A. General Provisions › Section 1114.001. Purpose

Sec. 1114.001.  PURPOSE.  The purpose of this chapter is to:
(1)  regulate the activities of insurers and agents with respect to the replacement of existing life insurance and annuities;
(2)  protect the interests of purchasers of life insurance or annuities by establishing minimum standards of conduct to be observed in replacement or financed purchase transactions;
(3)  ensure that purchasers receive information with which a decision in the purchaser's best interest may be made;
(4)  reduce the opportunity for misrepresentation and incomplete disclosure; and
(5)  establish penalties for failure to comply with the requirements adopted under this chapter.
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter A. General Provisions › Section 1114.002. General Definitions

Sec. 1114.002.  GENERAL DEFINITIONS.  In this chapter:
(1)  "Agent" means an individual who holds a license  under Chapter 4054 and who sells, solicits, or negotiates life insurance or annuities in this state.
(2)  "Direct-response solicitation" means a solicitation made:
(A)  by a sponsoring or endorsing entity or individually; and
(B)  solely through mails, telephone, the Internet, or other mass communication media.
(3)  "Existing insurer" means the insurer, the policy or contract of which is or will be changed or affected by a replacement.
(4)  "Existing policy or contract" means an individual life insurance policy or annuity contract that is in force, including a policy under a binding or conditional receipt or a policy or contract that is within an unconditional refund period.
(5)  "Financed purchase" means the purchase of a new policy that involves the actual or intended use of funds to pay all or part of any premium due on the new policy obtained by:
(A)  the withdrawal or surrender of an existing policy; or
(B)  borrowing from values of an existing policy.
(6)  "Illustration" means a presentation or depiction that includes nonguaranteed elements of a life insurance policy over a period of years.
(7)  "Registered contract" means a variable annuity contract or variable life insurance policy subject to the prospectus delivery requirements of the Securities Act of 1933 (15 U.S.C. Section 77a et seq.).
(8)  "Replacement" means a transaction under which a new policy or contract is to be purchased, and for which it is known or should be known to the proposing agent or proposing insurer that, by reason of the transaction, an existing policy or contract has been or is to be:
(A)  lapsed, forfeited, surrendered or partially surrendered, assigned to a replacing insurer, or otherwise terminated;
(B)  converted to reduced paid-up insurance, continued as extended term insurance, or otherwise reduced in value by the use of nonforfeiture benefits or other policy values;
(C)  amended so as to effect a reduction in benefits or in the term for which coverage would otherwise remain in force or for which benefits would be paid;
(D)  reissued with any reduction in cash value; or
(E)  used in a financed purchase.
(9)  "Replacing insurer" means the insurer that issues or proposes to issue a new policy or contract that:
(A)  replaces an existing policy or contract; or
(B)  is a financed purchase.
(10)  "Sales material" means a sales illustration and any other written, printed, or electronically presented information:
(A)  created or completed or provided by the insurer or agent; and
(B)  used in the presentation to the policy or contract owner relating to the policy or contract purchased.
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter A. General Provisions › Section 1114.003. Definition of Policy Summary

Sec. 1114.003.  DEFINITION OF POLICY SUMMARY.  (a)  For purposes of this chapter, "policy summary" has the meaning assigned by this section.
(b)  For a policy or contract other than a universal life insurance policy, "policy summary" means a written statement regarding the policy or contract that at minimum contains, to the extent applicable, the following information:
(1)  the current death benefit;
(2)  the annual contract premium;
(3)  the current cash surrender value;
(4)  the current dividend;
(5)  the application of the current dividend; and
(6)  the amount of any outstanding loan.
(c)  For a universal life insurance policy, "policy summary" means a written statement that contains, at minimum, the following information:
(1)  the beginning and ending date of the current reporting period;
(2)  the policy value at the end of the previous reporting period and at the end of the current reporting period;
(3)  the total amounts that have been credited or debited to the policy value during the current reporting period, identifying each by type, including interest, mortality, expense, and riders;
(4)  the current death benefit at the end of the current reporting period on each life covered by the policy;
(5)  the net cash surrender value of the policy as of the end of the current reporting period; and
(6)  the amount of any outstanding loans as of the end of the current reporting period.
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter A. General Provisions › Section 1114.005. Financed Purchase

Sec. 1114.005.  FINANCED PURCHASE.  (a)  If a withdrawal, surrender, or borrowing involving the policy values of an existing policy is used to pay premiums on a new policy that is owned by the same policyholder and is issued by the same insurer not earlier than four months before the effective date of the new policy or 13 months after the effective date of the new policy, it is deemed prima facie evidence of the policyholder's intent to finance the purchase of the new policy with existing policy values.
(b)  Subsection (a) applies only to regulatory review of an individual transaction.
(c)  The prima facie standard under Subsection (a) is not intended to increase or decrease the monitoring obligations contained in Section 1114.052(g).
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter A. General Provisions › Section 1114.006. Consumer Notice Documents

Sec. 1114.006.  CONSUMER NOTICE DOCUMENTS.  (a)  The commissioner by rule shall adopt or approve model documents to be used for consumer notices under this chapter.
(b)  The department may develop model documents under this section, or the commissioner may approve model documents developed by insurers or published by national organizations recognized by the commissioner.
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter A. General Provisions › Section 1114.007. Rules

Sec. 1114.007.  RULES.  The commissioner may adopt reasonable rules in the manner prescribed by Subchapter A, Chapter 36, to accomplish and enforce the purpose of this chapter.
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter B. Duties of Insurers and Agents › Section 1114.054. Duties of Existing Insurer

Sec. 1114.054.  DUTIES OF EXISTING INSURER.  (a)  If a transaction involves a replacement, the existing insurer shall comply with this section.
(b)  The existing insurer shall retain and be able to produce all replacement notifications received, indexed by the replacing insurer, until the later of:
(1)  the fifth anniversary of the date of receipt of the notification; or
(2)  the date of conclusion of the next regular examination conducted by the insurance regulatory authority of the existing insurer's state of domicile.
(c)  The existing insurer shall send a letter to the policy or contract owner regarding the owner's right to receive information regarding the existing policy or contract values.  The letter must include, if available, an in force illustration or, if an in force illustration cannot be produced not later than the fifth business day after the date of receipt of a notice that an existing policy or contract is being replaced, a  policy summary. The information must be provided not later than the fifth business day after the date of receipt of the request from the policy or contract owner.
(d)  On receipt of a request to borrow, surrender, or withdraw any policy values, the existing insurer shall send a notice advising the policy owner that the release of policy values may affect the guaranteed elements, nonguaranteed elements, face amount, or surrender value of the policy from which the values are released.  The notice must be sent separately from the payment if the payment is sent to any person other than the policy owner. In the case of consecutive automatic premium loans, the insurer is only required to send the notice at the time of the first loan.
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter B. Duties of Insurers and Agents › Section 1114.055. Duties of Insurers Regarding Direct Response Solicitations

Sec. 1114.055.  DUTIES OF INSURERS REGARDING DIRECT RESPONSE SOLICITATIONS.  (a)  In the case of an application initiated as a result of a direct response solicitation, the insurer shall require submission of a statement asking whether the applicant, by applying for the proposed policy or contract, intends to replace, discontinue, or change an existing policy or contract.  The statement may be included with,  or submitted as part of, each completed application for a policy or contract.  If the applicant indicates a replacement or change is not intended or if the applicant fails to respond to the statement, the insurer shall send the applicant, with the policy or contract, a notice, in a form adopted or approved by the commissioner, regarding replacement.
(b)  If the insurer has proposed the replacement or if the applicant indicates a replacement is intended and the insurer continues with the replacement, the insurer shall:
(1)  provide to the applicant or prospective applicant, with the policy or contract, a notice adopted or approved by the commissioner; and
(2)  comply with the requirements of:
(A)  Section 1114.053(c), if the applicant furnishes the names of the existing insurers; and
(B)  Sections 1114.053(d), (e), and (f).
(c)  In a situation described by Subsection (b)(1), the insurer may use a notice that deletes references to the agent, including the agent's signature, and references not applicable to the product being sold or replaced, without having to obtain prior approval of the notice from the commissioner. The insurer's obligation to obtain the applicant's signature is satisfied if the insurer can demonstrate that the insurer has made a diligent effort to secure a signed copy of the notice. The requirement to make a diligent effort is deemed satisfied if the insurer includes in the mailing a self-addressed postage prepaid envelope with instructions for the return of the signed notice.
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter B. Duties of Insurers and Agents › Section 1114.056. Registered Contracts

Sec. 1114.056.  REGISTERED CONTRACTS.  A registered contract is exempt from the requirements of Sections 1114.053(c) and 1114.054(c) with respect to the provision of illustrations or policy summaries, but must provide instead premium or contract contribution amounts and identification of the appropriate prospectus or offering circular.
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter B. Duties of Insurers and Agents › Section 1114.057. Disclosure of Availability of Waiver of Surrender Charges

Sec. 1114.057.  DISCLOSURE OF AVAILABILITY OF WAIVER OF SURRENDER CHARGES.  An insurer that offers to waive surrender charges as described by Section 541.058(b)(4) shall provide reasonable notice of that offer to the insurer's prospective or current contract holders.  The notice may be provided by any available means, including a disclosure document or by display on a link that is prominently placed on the insurer's Internet website.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 5, eff. September 1, 2011.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter C. Enforcement › Section 1114.101. Unfair Method of Competition; Sanctions and Penalties

Sec. 1114.101.  UNFAIR METHOD OF COMPETITION; SANCTIONS AND PENALTIES.  (a)  A failure by an insurer or agent to comply with this chapter constitutes a violation of Chapter 541 and is subject to sanctions and penalties as provided by that chapter. For purposes of this section, examples of violations include:
(1)  deceptive or misleading information set forth in any sales material;
(2)  failing to ask the applicant in completing the application the pertinent questions regarding the possibility of financing or replacement;
(3)  intentionally recording an answer incorrectly;
(4)  advising an applicant to respond negatively to any question regarding replacement in order to prevent notice to the existing insurer; or
(5)  advising a policy or contract owner to contact the insurer directly in such a way as to attempt to obscure the identity of the replacing agent or insurer.
(b)  A policy or contract owner has the right to replace an existing life insurance policy or annuity contract after indicating in or as a part of applications for new coverage that replacement is not the intention.  However, patterns of that  action by policy or contract owners of the same agent shall be deemed prima facie evidence of the agent's knowledge that replacement was intended in connection with the identified transactions, and those patterns of action shall be deemed prima facie evidence of the agent's intent to violate this chapter.
(c)  If it is determined that the requirements of this chapter have not been met, the replacing insurer shall provide to the policy owner:
(1)  an in force illustration or, if an in force illustration is not available, a policy summary for the replacement policy or an available disclosure document for the replacement contract; and
(2)  the appropriate notice regarding replacements.
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1114 - Replacement of Certain Life Insurance Policies and Annuities › Subchapter C. Enforcement › Section 1114.102. Additional Sanctions

Sec. 1114.102.  ADDITIONAL SANCTIONS.  (a)  In addition to sanctions and penalties under Chapter 541 as provided by Section 1114.101, an insurer or agent that violates this chapter is subject to sanctions as provided by Chapter 82, which may include:
(1)  the revocation or suspension of the agent's license or the insurer's certificate of authority;
(2)  administrative penalties under Chapter 84; and
(3)  forfeiture of any commissions or other compensation paid to an agent as a result of the transaction in connection with which the violations occurred.
(b)  In addition, if the commissioner has determined that the violations of this chapter were material to the sale, the insurer may be required to:
(1)  make restitution in the manner provided by Section 82.053;
(2)  restore policy or contract values; and
(3)  pay interest at the rate set by Section 84.050 on the amount refunded in cash.
Added by Acts 2007, 80th Leg., R.S., Ch. 904 (H.B. 2762), Sec. 1, eff. September 1, 2007.
2023 Texas Statutes › Insurance Code › Title 7 - Life Insurance and Annuities › Subtitle A - Life Insurance in General › Chapter 1115 - Suitability of Certain Annuity Transactions › Subchapter A. General Provisions › Section 1115.001. Purpose

Sec. 1115.001.  PURPOSE.  The purpose of this chapter is to require an agent to act in the best interest of the consumer when making a recommendation of an annuity and to require insurers to establish and maintain a system to supervise those recommendations so that the insurance needs and financial objectives of the consumer as of the time of the transaction are effectively addressed.
Added by Acts 2007, 80th Leg., R.S., Ch. 736 (H.B. 2761), Sec. 1, eff. September 1, 2007.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 1156 (H.B. 2277), Sec. 6, eff. September 1, 2011.
Acts 2021, 87th Leg., R.S., Ch. 262 (H.B. 1777), Sec. 2, eff. September 1, 2021.