Utah Admin. Code R590-93-3 - Definitions
Terms used in this rule are defined in Section 31A-1-301. Additional terms are defined as follows:
(1)
"Contract" means an annuity contract.
(2) "Direct-response solicitation" means a
solicitation through a sponsoring or endorsing entity or individually solely
through mail, telephone, the internet, or other mass communication
media.
(3)
(a) "Direct solicitation" means a
personalized solicitation to a specific individual through an insurer or
producer that is not a direct-response solicitation.
(b) Direct solicitation does not include a
group meeting held by a producer solely for the purpose of educating or
enrolling individuals or, when initiated by an individual member of the group,
assisting with the selection of investment options offered by a single insurer
in connection with enrolling that individual.
(4) "Existing insurer" means the insurance
company whose policy or contract is changed or affected in a manner described
within the definition of "replacement" in Subsection (12).
(5) "Existing policy or contract" means an
individual policy or contract in force, including a policy under a binding or
conditional receipt, or a policy or contract that is within an unconditional
refund period.
(6)
(a) "Financed purchase" means the purchase of
a new policy involving the actual or intended use of funds obtained by the
withdrawal or surrender of, or by borrowing from, values of an existing policy
to pay all or part of any premium due on the new policy.
(b)
(i) A
withdrawal, surrender, or borrowing involving the policy values of an existing
policy used to pay premiums on a new policy owned by the same policyholder and
issued by the same company within four months before or 13 months after the
effective date of the new policy is prima facie evidence of the policyholder's
intent to finance the purchase of the new policy with existing policy
yields.
(ii) The standard in
Subsection (i) does not change the monitoring requirements in Subsection
R590-93-4(1)(e).
(c) A financed purchase is a
replacement.
(7)
"Illustration" means a presentation or depiction that includes non-guaranteed
elements of a policy over a period of years as defined in Rule
R590-177.
(8) "Policy" means a life
insurance policy.
(9)
(a) "Policy summary," for a policy or
contract other than a universal life policy, means a written statement
regarding a policy or contract that includes the following information:
(i) the current death benefit;
(ii) the annual contract premium;
(iii) the current cash surrender
value;
(iv) the current
dividend;
(v) the application of
current dividend; and
(vi) the
amount of any outstanding loan.
(b) "Policy summary," for a universal life
policy, means a written statement that includes the following information:
(i) the beginning and end date of the current
report period;
(ii) the policy
value at the end of the previous report period and at the end of the current
report period;
(iii) the total
amounts that have been credited or debited to the policy value during the
current report period, identifying each by type, such as interest, mortality,
expense, and riders;
(iv) the
current death benefit at the end of the current report period on each life
covered by the policy;
(v) the net
cash surrender value of the policy as of the end of the current report period;
and
(vi) the amount of outstanding
loans, if any, as of the end of the current report period.
(10) "Registered contract" means a
contract or policy subject to the prospectus delivery requirements of the
Securities Act of 1933, 15 U.S.C. Sec. 77a.
(11) "Replacing insurer" means the insurance
company 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.
(12)
"Replacement" means a transaction in which a new policy or contract is to be
purchased, and the producer or insurer is aware, or should be aware, that an
existing policy or contract is or will be:
(a)
lapsed, forfeited, surrendered or partially surrendered, assigned to the
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 to effect either 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.
(13)
(a) "Replacement notice" means the same as
the following documents, available on the department's website,
https://insurance.utah.gov:
(i) Appendix A, Important Notice: Replacement
of Life Insurance or Annuities;
(ii) Appendix B, Notice Regarding
Replacement: Replacing Your Life Insurance Policy or Annuity; and
(iii) Appendix C, Important Notice:
Replacement of Life Insurance or Annuities.
(b) The replacement notice shall be made
available by the replacing insurer and must be imprinted with the name,
address, and telephone number of the replacing insurer.
(14) "Sales material" means a sales
illustration and any other written, printed, or electronically presented
information provided by the company or producer and used in the presentation to
the policy or contract holder related to the policy or contract
purchased.
Notes
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