Current through Register Vol. 56, No. 6, March
18, 2024
(a) A qualified
organization proposing to enter into an annuity agreement pursuant to
17B:17-13.1 shall first apply to
the Commissioner for approval as a special permit holder. The application shall
be in a form prescribed by the Commissioner. An application shall include, but
not be limited to, the following:
1. A
completed application form;
2.
Organizational documents, including the articles of incorporation or articles
of association and bylaws;
3. The
applicant's organizational chart, which shall identify the parent organization,
and all subsidiaries and affiliates of the applicant;
4. The applicant's or, where not available,
the applicant's parent organization's, most recent audited financial statements
and the Independent Auditors Report;
5. Documentation from the Internal Revenue
Service that the applicant is exempt from Federal income tax pursuant to
Section 501(c)(3) of the Internal Revenue Code;
6. The most recent Internal Revenue Form 990
and/or any other annual submissions that the Internal Revenue Service may
require because of the applicant's tax exempt status;
7. Documentation that the applicant is
registered and current with the New Jersey Department of the Treasury as a
domestic or foreign entity authorized to do business in New Jersey;
8. A copy of the Letter of Registration or
the Letter of Exemption issued to the applicant by the New Jersey Department of
Law and Public Safety, Division of Consumer Affairs, Charities Registration
Section;
9. Evidence that the
applicant has been in active operation for at least 10 years pursuant to
N.J.S.A. 17B:17-13.1a;
10.
Identification of any planned giving organization of which the applicant is a
member;
11. The board resolution
requiring the segregation of assets for annuity benefits;
12. The most recent annual statement for the
segregated account, which shall demonstrate that the applicant has a surplus
amount equal to the greater of 10 percent of the reserves or $ 100,000 pursuant
to 11:4-8.6(a)2. The
statement shall be prepared on a calendar year basis unless the applicant is
requesting to file this and all future statements on a fiscal year basis. If no
annuities have been issued in any state, the applicant may file as a
replacement for the annual statement documentation that a segregated account
has been established with assets of at least $ 100,000;
13. The name of the qualified actuary and/or
actuarial firm with which the applicant has contracted for the purpose of
reserve valuations.
14. If the
applicant has any inforce annuity agreements:
i. A Certificate of Valuation of the Annuity
Liabilities signed by a qualified actuary and notarized; and
ii. A statement signed by the actuary setting
forth his or her opinion as to the adequacy of the reserves reported in the
annual statement;
15.
The workpapers demonstrating the calculation of the reserves;
16. If the applicant seeks a waiver of the
actuarial opinion requirement pursuant to
11:4-8.8(b), the
information in (a)16i through iii below. Where such waiver is requested, the
applicant shall not be required to file the information set forth at (a)13 and
14 above unless notified by the Department that the waiver has been denied.
i. The name of the individual or the firm
responsible for determining the reserve liability;
ii. A description of the individual or firm's
experience; and
iii. The software
to be used to calculate the reserve liability.
17. A copy of each form of agreement that the
organization proposes to use when it enters into annuity agreements with donors
as described at
11:4-8.4;
18. A plan of operation for the segregated
account, including the investment strategy pursuant to
11:4-8.7;
19. The maximum annuity rates that the
applicant intends to use for each form of annuity. If the applicant does not
use the rates adopted by the American Council on Gift Annuities as permitted
for annuities issued in New Jersey, a demonstration that the rates meet the
requirements of
11:4-8.5(a);
and
20. A non-refundable
application fee of $ 100.00 made payable to "State of New Jersey--General
Treasury."
(b) An
application for a special permit shall be submitted to:
Office of Life and Health
Attention: Charitable Annuity Review
(c) The Commissioner shall review an
application for a special permit and notify the applicant in writing of any
deficiencies within 60 days of receipt. An applicant shall address any
deficiencies in its application within 60 days of receipt of such
notice.
(d) Upon receipt and review
of a complete application, the Commissioner shall issue a special permit to an
applicant if he or she finds that the applicant meets the following standards:
1. The applicant has provided a complete
application;
2. The applicant has
demonstrated that it is a qualified nonprofit domestic or foreign corporation
or association organized without capital stock or not for profit, engaged
solely in bona fide charitable, religious, missionary, educational or
philanthropic activities, and has been in active operation for at least 10
years;
3. The forms of agreement
proposed by the applicant comply with the requirements at
11:4-8.4(b);
4. The proposed rates comply with the
requirements at N.J.A.C. 11:4-8.5;
5. The applicant has demonstrated that it
currently meets the surplus and reserve requirements at N.J.A.C.
11:4-8.6;
6. The applicant has
demonstrated the expertise to administer the charitable annuities or has
contracted with a third party satisfactory to the Commissioner to do
so;
7. The applicant has
demonstrated adequate financial soundness to meet its charitable annuity
obligations on an ongoing basis; and
8. The plan of operation for the segregated
account includes all the information required at N.J.A.C. 11:4-8.7, and
satisfies the Commissioner that the standards at
3B:20-11.1 et seq. have been
met.
(e) An applicant
shall be notified in writing of the decision on an application within 90 days
of the Commissioner's receipt of a complete application.
(f) The Commissioner may deny an application
for a special permit if the applicant fails to meet any of the standards in
this subchapter or for any other reasonable grounds upon which the Commissioner
has determined that the issuance of charitable annuities by the applicant would
be hazardous to the citizens of this State. If the special permit is denied,
the Commissioner shall notify the applicant in writing of the reason(s) for the
denial.
