Ohio Administrative Code › Title 3901 - Department of Insurance › Chapter 3901-6 - Life Insurance › Section 3901-6-14 - Annuity disclosure

Current through all regulations passed and filed through July 1, 2024
(A) Purpose
The purpose of this rule is to provide standards for the
				disclosure of certain minimum information about annuity contracts to protect
				consumers and foster consumer education. The rule specifies the minimum
				information 
									to be disclosed, the method for disclosing it and
				the use and content of illustrations, if used, in connection with the sale of
				annuity contracts. The goal of this rule is to ensure that purchasers of
				annuity contracts understand certain basic features of annuity
				contracts.
(B) Authority
This rule is promulgated pursuant to the authority vested in
				the superintendent under sections
				3901.041 and
				3901.19 to
				3901.21 of the Revised
				Code.
(C) Applicability and
			 scope
This rule applies to all group and individual annuity contracts
				and certificates except:
(1) Immediate
			 and deferred annuities that contain no non-guaranteed elements;
(2) Annuities used to fund:
(a) An employee pension that is covered by
			 the Employee Retirement and Income Security Act of 1974 (29 U.S.C. section
			 1001 to
			 1148) (ERISA);
(b) A plan described by sections 401(a),
			 401(k), and 403(b) of the Internal Revenue Code of 1986, as amended
			 (26 U.S.C. sections
			 401(a),
			 401(k) and
			 403(b)), where
			 the plan, for the purposes of ERISA, is established or maintained by an
			 employer;
(c) A governmental or
			 church plan defined in section 414 or a deferred compensation plan of a state
			 or local government or a tax exempt organization under section 457 of the
			 Internal Revenue Code; or
(d) A
			 nonqualified deferred compensation arrangement established or maintained by an
			 employer or plan sponsor.
(3) Notwithstanding paragraph (C)(2) of this
			 rule, this rule 
									applies to annuities used to fund a plan or
			 arrangement that is funded solely by contributions an employee elects to make
			 whether on a pre-tax or after-tax basis, and where the insurance company has
			 been notified that plan participants may choose from among two or more fixed
			 annuity providers and there is a direct solicitation of an individual employee
			 by 
									an agent
			 for the purchase of an annuity contract. As used in this paragraph, direct
			 solicitation 
									does not include any meeting held by an agent solely
			 for the purpose of educating or enrolling employees in the plan or
			 arrangement;
(4) Non-registered
			 variable annuities issued exclusively to an accredited investor or qualified
			 purchaser as those terms are defined by the Securities Act of 1933
			 (15 U.S.C. section
			 77a to
			 77aa), the Investment Company Act
			 of 1940 (15 U.S.C. section
			 80a-1 to
			 80b-21), or the
			 regulations promulgated under either of those acts, and offered for sale and
			 sold in a transaction that is exempt from registration under the Securities Act
			 of 1933 (15 U.S.C. section
			 77a to
			 77aa).
(5)
(a)
			 Transactions involving variable annuities and other registered products in
			 compliance with "Securities and Exchange Commission" (SEC) rules and "Financial
			 Industry Regulatory Authority" (FINRA) rules relating to disclosures and
			 illustrations.
(b) Notwithstanding
			 paragraph (C)(5)(a) of this rule, the delivery of the buyer's guide is required
			 in sales of variable annuities, and when appropriate, in sales of other
			 registered products.
(c) Nothing in
			 this paragraph 
										limits the superintendent's ability to enforce
			 the provisions of this rule or to require additional disclosure.
(6) Structured settlement
			 annuities; and
(7) Funding
			 agreements.