Texas Administrative Code
Title 7 - BANKING AND SECURITIES
Part 2 - TEXAS DEPARTMENT OF BANKING
Chapter 25 - PREPAID FUNERAL CONTRACTS
Subchapter A - CONTRACT FORMS
Section 25.2 - Am I Required to Use the Model Contract and Model Waiver?

Universal Citation: 7 TX Admin Code ยง 25.2

Current through Reg. 49, No. 38; September 20, 2024

(a) Use of model contract and waiver. You may use the appropriate model contract or the model waiver described in this subsection except as provided in paragraph (2) of this subsection, but you are not required to do so if you obtain approval to use a non-model contract or waiver. PDF forms of model contracts or waivers and PDF forms of approved non-model contracts or waivers do not need to be approved by the department as provided in §25.5.

(1) The Department has adopted two model contracts, one for sale of trust-funded prepaid funeral benefits and one for sale of insurance-funded prepaid funeral benefits where the purchaser is also the policy owner, and a model waiver, in English and in Spanish, for your use. Each model contract or waiver meets all statutory requirements and the requirements of this subchapter with respect to the type of transaction it is designed to govern. You may acquire copies of model contracts and the model waiver by downloading them from the Department's web site or requesting them by mail. The Department's web site address is http://www.dob.texas.gov.

(2) If you sell insurance-funded contracts, the insurance-funded model contract is suitable only if the person named in the contract as the purchaser is also the insurance policy owner. If the contract purchaser and the insurance policy owner are not to be the same person, you must use an approved non-model contract that correctly addresses this arrangement.

(3) You may use a current model contract or model waiver after the department verifies that your proposed form document is a current model document that has been customized by inserting your name and permit number. Your submitted form document may also exclude the disclosure shown in Figure 7 TAC § RSA 25.3(i)(4)(E), if it is not applicable; and contain other information about you or a provider as long as you do not otherwise alter the model document. The department shall approve or disapprove a customized model document on or before the 10th business day following the day the document is filed with the department.

(b) Non-model contracts. Before you use a non-model contract, it must:

(1) satisfy the substantive content requirements of § RSA 25.3 of this title (relating to What Requirements Apply to a Non-Model Contract or Waiver);

(2) qualify under the plain language principles stated in § RSA 25.4 of this title (relating to What Are the Plain Language Requirements for a Non-Model Contract or Waiver); and

(3) be approved by the department as provided in § RSA 25.5 of this title (relating to How Do I Obtain Approval of a Non-Model Contract or Waiver).

(c) Non-model waivers. You may use a non-model waiver if it addresses substantially the same matters in substantially the same order as the model waiver, to promote comparability and consumer understanding. Your proposed non-model waiver form may contain additional provisions that are fair to consumers in light of the purpose of Finance Code, Chapter 154. You must submit a non-model waiver to the Department for approval in the manner required by § RSA 25.5 of this title. The model waiver in English appears as:

Attached Graphic

(d) Transactions conducted in Spanish. If you intend to conduct any prepaid funeral benefits transaction predominately in Spanish, you may use a current model contract or model waiver in Spanish as provided by subsection (a) of this section. If the department has approved your non-model document in English under § RSA 25.5 of this title, you may use a Spanish version of the document after you file a copy of your Spanish document and a certification from a translation service acceptable to the department that the Spanish version is a true and correct translation of the submitted English document. If the English version of your Spanish non-model document has not previously been approved, you may not use your Spanish non-model document until you comply with subsection (b) of this section.

(e) Interpretation of required content and form. The department considers the model contracts and model waiver to satisfy the substantive content requirements of § RSA 25.3 of this title and qualify under the plain language principles stated in § RSA 25.4 of this title. If you have questions regarding the intent and meaning of a requirement in this subchapter, locate and review the related clause in the model contracts or model waiver. You are not required to include a broader or more comprehensive provision than is contained in the relevant model document unless additional explanation or disclosure is necessary to clarify or prevent misleading provisions in your non-model document.

(f) Sale of Prepaid Funeral Benefits Electronically.

(1) You may sell prepaid funeral benefits and deliver contracts and waivers by electronic means if the purchaser has consented to transacting electronically.

(2) A purchaser must consent to the use of electronic documents before you present the document to the purchaser, consistent with Electronic Signatures in Global and National Commerce Act, RSA 7001.

(3) A contract or waiver is not considered as entered into or delivered electronically if a completed paper copy in the approved form is given to the purchaser at the time of sale.

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