Code of Massachusetts Regulations › 211 CMR - DIVISION OF INSURANCE › Title 211 CMR 142.00 - Insurance sales by banks, credit unions and lenders › Section 142.05 - Consumer Protection Terms and Conditions Governing the Sale of Insurance by Banks

Current through Register 1525, July 5, 2024
(1) A Bank shall be
			 permitted to conduct insurance sales activities at the main office or at any
			 branch thereof.
(2) A Bank must, to
			 the extent practicable, keep the area where the Bank conducts insurance sales
			 activities physically segregated from areas where retail deposits are routinely
			 accepted from the general public. A Bank must identify the areas where
			 insurance sales activities occur, and clearly delineate and distinguish those
			 areas from the areas where the Bank's retail deposit-taking activities occur.
(a) A State Bank, State-chartered Credit
			 Union or Lender may obtain a waiver for the requirement of physical separation
			 of transactions involving insured deposits or extensions of credit and
			 insurance sales activities from the Commissioner of Banks pursuant to
			 209
			 CMR 49.06(4):
Insurance Sales on Bank Premises
. If a State Bank or Lender
			 obtains such a waiver from the Division of Banks, it shall promptly forward a
			 copy of the order approving the waiver to the Division.
(b) With respect to a Federal Bank or Federal
			 Credit Union, the Commissioner, in his or her discretion, may waive the
			 requirement under 211 CMR 142.05(2) for the physical separation of transactions
			 involving insured deposits or extensions of credit and insurance sales
			 activities upon a demonstration by a Federal Bank or Federal Credit Union that
			 space considerations, such as the size or design of said bank premises,
			 preclude such separation. The burden is upon the applicant Federal Bank or
			 Federal Credit Union to demonstrate that size, design, landmark status,
			 National Register of Historic Places designation, site impediments, local
			 zoning requirements, building codes, fire codes or other relevant
			 considerations warrant the granting of a waiver.
1. The following conditions shall apply to
			 any waiver granted under 211 CMR 142.05(2)(b):
a. Common areas may be permitted for banking
			 and credit transactions and insurance purposes if physical constraints
			 warranting such condition are satisfactorily demonstrated by a Federal Bank's
			 or Federal Credit Union's waiver application.
b. In any instance where such waiver is
			 granted, a Federal Bank or Federal Credit Union employee, licensed as an
			 insurance producer, shall not, in any manner involving the application by a
			 customer for an extension of credit by said bank or credit union, act as the
			 representative of the Federal Bank or Federal Credit Union both with respect to
			 said application and with respect to the solicitation and sale of insurance
			 products to said customer, whether or not such insurance is required for the
			 extension of credit.
c. It shall be
			 the responsibility of a Federal Bank or Federal Credit Union to institute
			 procedures to eliminate customer misunderstanding or confusion as to the
			 distinction between such insurance products and other bank functions, and to
			 prevent any misrepresentation thereof if a waiver is granted.
d. The Commissioner, in his or her
			 discretion, may impose such other conditions as may be deemed necessary to
			 effectuate the purposes of 211 CMR 142.05(2).
e. The Commissioner, in his or her
			 discretion, may subject a waiver application under 211 CMR 142.05(2)(b) to such
			 notice and hearing as may be required.
2. Notwithstanding 211 CMR 142.05(2)(b), any
			 Federal Bank premises constructed, purchased, leased or acquired by a Federal
			 Bank on or after September 1, 1998, or on or after June 20, 2003 for a Federal
			 Credit Union subject to M.G.L. c. 171, § 75B, for the conduct of its
			 authorized business, including the solicitation and sale of insurance, shall
			 not be eligible for the waiver provided for herein, unless said acquisition
			 results from a merger, consolidation or purchase of assets pursuant to federal
			 law.
3. Applications for waivers
			 shall be available for public inspection from the Division upon request unless
			 the information is exempt from disclosure under M.G.L. c. 66, § 10, and
			 M.G.L. c. 4, § 7, cl. 26. Decisions approving or denying such applications
			 shall be in writing and shall be available for public inspection from the
			 Division upon request.