Rules & Regulations of the State of Tennessee
Title 0780 - Commerce and Insurance
Subtitle 0780-01 - Insurance Division
Chapter 0780-01-24 - Replacement of Life Insurance Policies
Section 0780-01-24-.02 - DEFINITION OF REPLACEMENT
Current through September 24, 2024
''Replacement Transaction'' means any transaction in which new life insurance is to be purchased, and it is known or should be known to the prosposing agent or to the proposing insurer if there is no agent, that by reason of such transaction, existing life insurance has been or is to be:
(1) Lapsed, forfeited, surrendered, or otherwise terminated;
(2) 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;
(3) Amended so as 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;
(4) Reissued with any reduction in cash value; or
(5) Pledged as collateral or subjected to borrowing, whether in a single loan or under a schedule of borrowing over a period of time for amounts in the aggregate exceeding twenty-five percent (25%) of the loan value set forth in the policy.
(6) The replacement transaction also includes conservation by the existing insurer or its agent.
Authority: T.C.A. §§ 56-1-701, 56-2-301, 56-6-127 and 56-8-104.
