Current through September 24, 2024
(1) The
commissioner may conduct an examination or investigation under T.C.A. §
56-50-101 et seq. of an applicant,
licensee, or any other persons engaged in the business of life settlements as
often as, or when, the commissioner in his or her sole discretion deems it
reasonably necessary to protect the interests of the public.
(2) Record Retention Requirements
(a) A person required to be licensed by
T.C.A. §
56-50-101 et seq. shall retain
copies of all:
1. Proposed, offered or
executed contracts, underwriting documents, policy forms, and applications from
the date of the proposal, offer or execution of the contract, whichever is
later;
2. All checks, drafts or
other evidence and documentation related to the payment, transfer, deposit or
release of funds from the date of the transaction; and
3. All other records and documents related to
the requirements of T.C.A. §
56-50-101 et seq.
(b) The records required to be
retained by subsection (a) shall be retained until five (5) years after the
death of the insured that is the subject of the life settlement contract.
Records required to be retained must be legible and complete and may be
retained in paper, photograph, microprocess, magnetic, mechanical, or
electronic media, or by any process that accurately reproduces or forms a
durable medium for the reproduction of a record.
(c) If no life settlement contract is
executed between an owner and a life settlement provider, the records required
to be retained by subsection (a) shall be retained for a period of three (3)
years after the date the proposed or offered contract is rejected or contract
negotiations cease, whichever date is last. Records required to be retained
must be legible and complete and may be retained in paper, photograph,
microprocess, magnetic, mechanical, or electronic media, or by any process that
accurately reproduces or forms a durable medium for the reproduction of a
record.
(3) Conduct of
Examinations and Investigations
(a) Upon
determining that an examination should be conducted, the commissioner shall
issue an examination order appointing one or more examiners to perform the
examination and instructing them as to the scope of the examination. In
conducting the examination, the examiner shall observe those guidelines and
procedures set forth in the "Examiners' Handbook" adopted by the National
Association of Insurance Commissioners (NAIC). The commissioner may also employ
such other guidelines or procedures as the commissioner may deem
appropriate.
(b) Every applicant,
licensee or person from whom information is sought, its officers, directors,
partners, members, employees and agents shall provide to the examiners timely,
convenient and free access at all reasonable hours at its offices to all books,
records, accounts, papers, documents, assets and computer or other recordings
relating to the property, assets, business and affairs of the applicant or
licensee being examined. The officers, directors, partners, members, employees,
contractors and agents of the applicant, licensee or person shall facilitate
the examination and aid in the examination so far as it is in their power to do
so. The refusal of an applicant or licensee, by its officers, directors,
partners, members, employees, agents, or contractors, to submit to examination
or to comply with any reasonable written request of the commissioner shall be
grounds for denial of an application for a license, suspension, revocation or
nonrenewal of any license or authority held by the licensee to engage in the
life settlement business or other business subject to the jurisdiction of the
commissioner. Any proceedings for suspension, revocation or nonrenewal of any
license or authority shall be conducted pursuant to the Uniform Administrative
Procedures Act, Tennessee Code Annotated Title 4, Chapter 5.
(c) The commissioner shall have the power to
issue subpoenas, to administer oaths and to examine under oath any person as to
any matter pertinent to an examination or investigation. Upon the failure or
refusal of a person to obey a subpoena, the commissioner may petition a court
of competent jurisdiction, and upon proper showing, the court may enter an
order compelling the witness to appear and testify or produce documentary
evidence. Failure to obey the court order may be punishable as contempt of
court.
(d) When making an
examination under T.C.A. §
56-50-101 et seq., the
commissioner may retain attorneys, appraisers, independent actuaries,
independent certified public accountants or other professionals and specialists
as examiners, the cost of which shall be borne by the applicant or licensee
that is the subject of the examination.
(4) Any person engaged in the business of
life settlements having knowledge or a reasonable belief that a fraudulent act
is being, will be, or has been committed in connection with a life settlement
transaction shall provide to the commissioner the information required by, and
in a manner prescribed by the commissioner.
(5) Any other person having knowledge or a
reasonable belief that a fraudulent act is being, will be, or has been
committed in connection with a life settlement transaction shall provide to the
commissioner the information required by, and in a manner prescribed by, the
commissioner.
Authority: T.C.A. §§
56-1-204,
56-50-103, 56-50-106, 56-50-107,
56-50-110, and 56-53-109.
