Missouri Code of State Regulations › Title 20 - DEPARTMENT OF COMMERCE AND INSURANCE › Division 2120 - State Board of Embalmers and Funeral Directors › Chapter 3 - Preneed › Section 20 CSR 2120-3.525 - Independent Financial Advisor is Agent of Trustee and Authorized External Investment Advisor

Current through Register Vol. 49, No. 14, July 15, 2024
PURPOSE: The purpose of this amendment is to provide
				  additional clarification relating to authorized external investment advisors
				  and their requirements and clarifies differences in statutory requirements pre-
				  and post- August 28, 2009 when the law changed.
PURPOSE: This rule clarifies that an independent
				  financial advisor is an agent of the trustee in a trust-funded preneed contract
				  and sets forth the qualifications and duties of an authorized external
				  investment advisor for a preneed trust.
(1) An independent financial advisor, as
				provided in section 436.440.6, RSMo, is an agent, as provided in section
				436.440,
				RSMo, of the trustee.
(2) An
				authorized external investment advisor, as provided in section
				436.445,
				RSMo, is an agent, as provided in section
				436.440,
				RSMo, of the trustee.
(3) A preneed
				trust may utilize the services of an authorized external investment advisor as
				provided in sections
				436.435,
				436.440,
				and
				436.445,
				RSMo.
(4) Any authorized external
				investment advisor utilized by a pre-need trustee must have a current and
				active federal or Missouri registration as an investment advisor at all times
				when he or she serves as an investment advisor for a preneed trust.
(5) Any authorized external investment
				advisor shall exercise his or her duties in compliance with the provisions of
				applicable state and federal laws including compliance with his or her
				fiduciary duties including the duties of loyalty and of care.
(6) Except as provided in sections
				436.400
				to
				436.525,
				RSMo, only a preneed trustee may retain the services of an authorized external
				investment advisor to assist the preneed trustee with the investment of preneed
				trust assets.
(7) If a preneed
				trustee utilizes the services of authorized external investment advisor, that
				relationship shall be memorialized in a written agreement that discloses the
				scope of duties and powers delegated, the compensation to be paid to the
				authorized external investment advisor, any relationship or contracts between
				the authorized external investment advisor and the seller, any relationship or
				contract between the authorized external investment advisor and any provider of
				any preneed contract for which funds are held in the seller's preneed trust,
				and any other provisions that the trustee deems necessary to meet its fiduciary
				duties.
(8) Any independent
				financial advisor, in place before August 28, 2009 in compliance with the
				provisions of section 436.440.6, RSMo, must be either a federally registered or
				Missouri registered independent qualified investment advisor at all times when
				acting as an investment advisor for a preneed trust and must meet all
				requirements required of an authorized external investment advisor.
*Original authority: 333.340, RSMo 2009; 436.440, RSMo
					 2009; and 436.520, RSMo 2009.