Code of Maine Rules
02 - DEPARTMENT OF PROFESSIONAL AND FINANCIAL REGULATION
031 - BUREAU OF INSURANCE
Chapter 915 - ANNUITY DISCLOSURE
Section 031-915-5 - Standards for the Disclosure Document and Buyer's Guide
Universal Citation: 02 ME Code Rules ยง 031-915-5
Current through 2024-38, September 18, 2024
A.
(1)
Where the application for an annuity contract is taken in a face-to-face
meeting, the applicant shall at or before the time of application be given both
the disclosure document described in Subsection B and the appropriate Buyer's
Guide.
(2) Where the application
for an annuity contract is taken by means other than in a face-to-face meeting,
the applicant shall be sent both the disclosure document and the Buyer's Guide
no later than five business days after the completed application is received by
the insurer.
(a) With respect to an
application received as a result of a direct solicitation through the mail:
(i) Providing a Buyer's Guide in a mailing
inviting prospective applicants to apply for an annuity contract shall be
deemed to satisfy the requirement that the Buyer's Guide be provided no later
than five business days after receipt of the application.
(ii) Providing a disclosure document in a
mailing inviting a prospective applicant to apply for an annuity contract shall
be deemed to satisfy the requirement that the disclosure document be provided
no later than five business days after receipt of the application.
(b) With respect to an application
received via the Internet:
(i) Taking
reasonable steps to make the Buyer's Guide available for viewing and printing
on the insurer's website shall be deemed to satisfy the requirement that the
Buyer's Guide be provided no later than five business days after receipt of the
application.
(ii) Taking reasonable
steps to make the disclosure document available for viewing and printing on the
insurer's website shall be deemed to satisfy the requirement that the
disclosure document be provided no later than five business days after receipt
of the application.
(c)
A solicitation for an annuity contract provided in other than a face-to-face
meeting shall include a statement that the proposed applicant may contact the
insurance department of the state for a free annuity Buyer's Guide. In lieu of
the foregoing statement, an insurer may include a statement that the
prospective applicant may contact the insurer for a free annuity Buyer's
Guide.
(d) Where the Buyer's Guide
and disclosure document are not provided at or before the time of application,
a free look period of no less than 15 days shall be provided for the applicant
to return the annuity contract without penalty. This free look shall run
concurrently with any other free look provided under state law or rule.
B. At a minimum, the following information shall be included in the disclosure document required to be provided under this rule:
(1)
The generic name of the contract, the company product name, if different, and
form number, and the fact that it is an annuity;
(2) The insurer's legal, name, physical
address, website address and telephone number;
(3) A description of the contract and its
benefits, emphasizing its long-term nature, including examples where
appropriate:
(a) The guaranteed and
non-guaranteed elements of the contract, and their limitations, if any,
including for fixed indexed annuities, the elements used to determine the
index-based interest, such as the participation rates, caps or spread, and an
explanation of how they operate;
(b) An explanation of the initial crediting
rate, or for fixed indexed annuities, an explanation of how the index-based
interest is determined, specifying any bonus or introductory portion, the
duration of the rate and the fact that rates may change from time to time and
are not guaranteed;
(c) Periodic
income options both on a guaranteed and non-guaranteed basis;
(d) Any value reductions caused by
withdrawals from or surrender of the contract;
(e) How values in the contract can be
accessed;
(f) The death benefit, if
available and how it will be calculated;
(g) A summary of the federal tax status of
the contract and any penalties applicable on withdrawal of values from the
contract; and
(h) Impact of any
rider, including, but not limited to, a guaranteed living benefit or long-term
care rider;
(4) Specific
dollar amount or percentage charges and fees shall be listed with an
explanation of how they apply; and
(5) Information about the current guaranteed
rate or indexed crediting rate formula, if applicable, for new contracts that
contains a clear notice that the rate is subject to change.
C. Insurers shall define terms used in the disclosure statement in language that facilitates the understanding by a typical person within the segment of the public to which the disclosure statement is directed.
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