2023 Tennessee Code › Title 62 - PROFESSIONS, BUSINESSES AND TRADES (§§ 62-1-101 — 62-76-203) › Chapter 5 - FUNERAL DIRECTORS AND EMBALMERS (§§ 62-5-101 — 62-5-810) › Part 4 - TENNESSEE PREPAID FUNERAL BENEFITS ACT (§§ 62-5-401 — 62-5-417) › Section 62-5-406 - Filing of pre-need funeral contract - Contract form requirements - Revocable and irrevocable contracts

(a)
(1)
No pre-need funeral contract shall be offered in this state until a copy of the contract has been issued by the commissioner for general use.
(2)
If no contract has been issued by the commissioner pursuant to subdivision (a)(1), then no pre-need funeral contract shall be offered in this state until a copy of the contract has been filed with and approved by the commissioner. If the commissioner does not disapprove the contract within sixty (60) days after receipt of the request for approval, the contract shall be deemed approved. The commissioner may disapprove a previously approved pre-need funeral contract if the pre-need funeral contract violates this section upon giving notice and an opportunity for a hearing to the pre-need seller.
(b)
Each pre-need contract form shall:
(1)
Be written in clear and understandable language printed in an easy-to-read type size and style;
(2)
Contain space to include the name, address, telephone number, and registration number of the pre-need seller obligated to provide the services under the contract terms, and all the information must be completed before the contract is signed by the purchaser;
(3)
Clearly identify whether the contract is a guaranteed pre-need funeral contract or a non-guaranteed pre-need funeral contract; and
(A)
If the contract is funded by a pre-need funeral trust, the pre-need funeral contract shall state whether the pre-need funeral trust it establishes is revocable or irrevocable.
(B)
If the pre-need funeral trust is irrevocable, the pre-need funeral contract shall state on its face and in bold type the following words: THE PRE-NEED FUNERAL TRUST ACCOUNT ESTABLISHED BY THIS CONTRACT IS IRREVOCABLE, AND THE FUNDS PAID HEREUNDER ARE NOT REFUNDABLE. ACCUMULATED TRUST PRINCIPAL AND INTEREST ARE FREELY TRANSFERABLE TO SATISFY FUNERAL EXPENSES AT ANY LICENSED FUNERAL ESTABLISHMENT AS PROVIDED BY LAW.
(C)
If the pre-need funeral trust is revocable, the purchaser of the merchandise or services under the agreement, contract or plan shall be entitled to receive any or all of the payments made and any earnings or interest on the payments, less any applicable fees and expenses permitted by this part, upon demand in writing on the pre-need seller and the trustee. Absent gross negligence or willful misconduct by the trustee, payment by the trustee of the amount held in trust, less any applicable fees and expenses permitted by this part, shall relieve the trustee of further liability to the purchaser in connection with the trust.
(c)
No modification of the form, terms, or conditions of the pre-need contract may be made without the prior written approval of the commissioner.
(d)
No pre-need funeral contract shall provide for the funeral establishment, pre-need seller, or pre-need sales agent to receive any benefits from a prearrangement insurance policy or moneys from a pre-need funeral trust other than the amount of payment for the merchandise and services provided by the funeral establishment. This subsection (d) shall not prohibit the payment of commissions authorized to be paid under title 56, chapter 6.
(e)
This section shall apply only to pre-need funeral contracts executed subsequent to January 1, 2008.
(f)
A pre-need seller that is a cemetery company may offer a pre-need funeral contract that covers cemetery merchandise as defined in §
46-1-102
, or a pre-need funeral contract that covers both funeral merchandise and cemetery merchandise, on a contract issued by the commissioner or, if the commissioner has not issued a contract, on a contract approved by the commissioner. The pre-need seller that is a cemetery company shall comply with the requirements provided in title 46, chapter 1, for selling cemetery merchandise.
Amended by 2016 Tenn. Acts, ch. 911, Secs.s 3, s 4 eff. 4/27/2016.
Acts 2007 , ch. 592, § 7; 2008 , ch. 1065, § 1.