Current through Reg. 49, No. 38; September 20, 2024
(a) Contract
requirements. The department must approve a non-model contract before you can
use it. Your proposed non-model contract must:
(1) contain a disclosure informing the
purchaser of the funeral goods and services that will be provided under the
contract, as described by subsections (b) and (c) of this section;
(2) define terms used in the contract as
described by subsection (d) of this section;
(3) state and explain the purchaser's
obligations, your obligations, and the name and obligations of the provider if
you are not performing all funeral services under the contract;
(4) if the provider is not the licensed
seller, a statement that the provider agrees to discharge the responsibilities
imposed on a funeral provider by Finance Code §
RSA
154.161;
(5) the impact of terms in the insurance
policy on the contract if the contract is insurance-funded, as described by
subsection (e) of this section;
(6)
disclose and explain the purchaser's cancellation rights under the contract
and, if the contract is insurance-funded, the effect of insurance policy
cancellation or assignment on the contract, as described by subsection (f) of
this section;
(7) state events of
default under the contract for all parties and explain the consequences of
default, as described by subsection (g) of this section;
(8) state and explain the circumstances under
which the responsible person may modify or change the contract at the death of
the contract beneficiary, as described by subsection (h) of this
section;
(9) disclose and explain
all payment terms under the contract and related provisions as described by
subsection (i) of this section;
(10) contain a section for required
signatures and related notices as described by subsection (j) of this
section;
(11) contain a standard
disclosure explaining how a purchaser can make inquiries or file complaints
with specified regulatory agencies, as described by subsection (k) of this
section;
(12) comply with
subsections (l) and (m) of this section;
(13) comply with §
RSA
25.4 of this title (relating to What Are the
Plain Language Requirements for a Non-Model Contract or Waiver); and
(14) be approved by the department as
provided by §
RSA
25.5 of this title (relating to How Do I
Obtain Approval of a Non-Model Contract or Waiver).
(b) Statement of guaranteed funeral goods and
services selected. The first section of a proposed prepaid funeral benefits
contract must inform the purchaser of the guaranteed funeral goods and services
that you will provide under the contract, as required by Finance Code, §
RSA
154.151(e). This section
must appear entirely on page one of the contract exactly as set out in the
model contract and in the following figure, including substantially the same
formatting and spacing, except:
Attached Graphic
(1) you may move specific goods and
services between general description categories;
(2) you may move specific goods and services
from figure 7 TAC § 25.3(c)(1) to figure 7 TAC § 25.3(b), if you
guarantee the price of the good or service and include any required Federal
Trade Commission disclosures regarding cash advance items;
(3) you may change the description of
specific goods or services if the alteration does not change the intent of the
description in the standard disclosure;
(4) you may add other, specific funeral goods
and services to the list of funeral goods and services to be
provided;
(5) you may delete check
boxes and related text for sealing features in casket and outer burial
container descriptions, for example, "gasketed", "non-gasketed", "seal", and
"non-seal", if these features are not included in the funeral home's price
list; and
(6) if the goods and
services you sell are specifically limited and constitute significantly less
than those goods and services normally required for a funeral, you may
substitute a simplified disclosure that the contract is for your specific goods
and services only and that you do not offer any other funeral goods and
services. For example, you may substitute this limited disclosure if you sell
only services relating to opening and closing of the grave or unique memorials
that utilize a token portion of cremains, or if you only sell limited funeral
goods such as outer burial containers or caskets without furnishing funeral
services.
(7) The Explanation of
Certain Charges language may be moved from figure 7 TAC § 25.3(c)(1) to
figure 7 TAC § 25.3(b).
(8) If
your contract is in electronic form, the statement of guaranteed funeral goods
and services selected must appear on a single screen or consecutive screens,
near the beginning or top of the contract, immediately following consumer
disclosures and consent required by 7 TAC §
RSA
25.2(f).
(c) Statement of non-guaranteed
cash advance items selected.
(1) The second
section of a proposed prepaid funeral benefits contract must inform the
purchaser of the non-guaranteed cash advance items that you will provide under
the contract, as required by Finance Code, §
RSA
154.1511(b). The section
must appear entirely on either page one or two of the contract exactly as set
out in the model contract and in the following figure, including substantially
the same formatting and spacing, except;
Attached Graphic
(A) you may delete the non-guaranteed
cash advance items section if you do not sell cash advance items;
(B) you may move the Explanation of Certain
Charges language to figure 7 TAC § 25.3(b);
(C) you may change the subtotal pages
references if figures 7 TAC § 25.3(b) and7 TAC § 25.3(c)(1) are to be
placed on the same page of the contract;
(D) you may move specific goods and services
from figure 7 TAC § 25.3(c)(1) to figure 7 TAC § 25.3(b) if you
guarantee the price of the good or service;
(E) you may change the description of
specific goods or services if the alteration does not change the intent of the
description in the standard disclosure;
(F) you may add other specific funeral goods
and services to the list of non-guaranteed funeral goods and services to be
provided only through a non-model filing; and
(G) if your contract is in electronic form,
this section must appear on a single screen immediately following the statement
of guaranteed funeral goods and services selected.
(2) If you delete the statement of
non-guaranteed cash advance items:
(A) for a
paper contract, you must include figure 7 TAC §25.3(c)(2)(B) on the bottom
of page one of the contract, including substantially the same formatting and
spacing; and
(B) for a contract in
electronic form, you must include the following figure immediately following
the statement of guaranteed funeral goods and services selected:
Attached Graphic
(d)
Definitions. Your proposed prepaid funeral benefits contract must list, define,
and use the terms "contract beneficiary", "responsible person", "provider",
"purchaser", and "seller", or terms commonly understood by consumers to be
equivalent, substantially as defined in a model contract. For example, you may
use a combined term such as "seller/provider" if you believe the alternate term
is more descriptive of your services. If your proposed contract is
insurance-funded, you must also list, define, and use the terms "insurance
company", "insurance policy", and "premiums" in the contract, or terms commonly
understood by consumers to be equivalent, substantially as defined in the
department's insurance-funded model contract. You may list, define and use
additional terms if they are consistent with the requirements of §
RSA
25.4 of this title.
(e) General provisions. Your proposed prepaid
funeral benefits contract must recognize and explain the purchaser's
obligations, your obligations, and the obligations of the provider if you are
not performing all funeral services under the contract, and the impact of terms
in the insurance policy on the contract if the contract is insurance-funded,
with respect to:
(1) your obligation (and
that of the provider) to furnish the guaranteed funeral goods and services
selected in the contract for a cost not to exceed the total contract price
applicable to the guaranteed charges at the death of the contract beneficiary,
if the purchaser has fully complied with the contract and with each insurance
policy, if the contract is insurance-funded;
(2) your obligation (and that of the
provider) to furnish the non-guaranteed cash advance items selected in the
contract, if current costs are paid at the time of death or how any unallocated
and remaining non-guaranteed funds will be refunded;
(3) the purchaser's inability to change the
selected funeral goods and services during the life of the contract unless the
contract is voided and replaced with a new contract;
(4) the extent to and conditions under which
the purchaser may change the provider specified in the contract or, with
respect to a trust-funded contract, the contract beneficiary;
(5) whether the purchaser may incur tax
liability for earnings under a trust-funded contract or for growth under an
insurance policy if the contract is insurance-funded;
(6) the extent to which you offer any
warranties or guarantees or assert any specific disclaimers of
warranty;
(7) the prohibition on
partial cancellation of or loans against the contract;
(8) if the transaction may result in
available funds in excess of the contract price at the time the funeral is
performed, identification of who is entitled to such excess funds;
(9) each party's general contractual duties
under the contract and the extent to which the contract is binding on a person
who assumes the rights or obligations of a party to the contract;
(10) the manner in which a party must notify
other parties of a change of address; and
(11) if the contract is insurance-funded, the
requirement that terms of the insurance policy must be consulted for
information concerning the obligations of the insurance company and those of
the policy owner.
(f)
Cancellation or assignment. Your proposed prepaid funeral benefits contract
must recognize and explain:
(1) with respect
to a trust-funded contract:
(A) the manner in
and conditions under which the purchaser may cancel the contract, including the
procedural requirements applicable to a cancellation, including the purchaser's
obligation to request cancellation in writing on department-approved forms and
your obligation to pay a refund not later than the 30th day after receipt of
the purchaser's written cancellation notice;
(B) the amount of the refund or other payment
that you will owe the purchaser if the contract is canceled and the conditions
or circumstances that may alter the refund amount; and
(C) the refund or other benefits you will owe
the purchaser if the contract is canceled at your request; or
(2) subject to modifications or
clarifications required by §
RSA
25.2(a)(2) of this title
(Relating to Am I Required to Use the Model Contract and Model Waiver), with
respect to an insurance-funded contract:
(A)
the purchaser's right to assign the purchaser's interest in an insurance policy
by signing a separate document;
(B)
the qualification that canceling the contract does not automatically cancel the
insurance policy but canceling the insurance policy does cancel the
contract;
(C) the procedural
requirements applicable to a cancellation of the contract, including the
purchaser's obligation to request cancellation in writing on
department-approved forms and the statutory obligation, if applicable, to pay a
refund not later than the 30th day after receipt of the purchaser's written
cancellation notice;
(D) the
purchaser's obligation to read the insurance policy to determine the conditions
imposed upon cancellation and the potential amount of refund that would be due
if the policy is canceled during or after the "free look" period;
(E) notice and acknowledgement by the
purchaser that if the insurance policy is cancelled at the purchaser's request,
the surrender value may be significantly less than the premiums the purchaser
paid. The disclosure must appear in the cancellation section exactly as set out
in the model contract and in the following figure, without modification,
including substantially the same formatting and spacing:
Attached
Graphic
(F) the
consequences the purchaser may expect, whether refund of premium, receipt of
cash surrender value, or other benefits from you or another person, if the
contract is canceled at your request; and
(G) the effect that loans against or
withdrawal of proceeds accrued under an insurance policy will have on the
contract and on price guaranties in the contract.
(g) Default. Your proposed prepaid
funeral benefits contract must explain events and consequences of default under
the contract and under each insurance policy if the contract is
insurance-funded, including:
(1) the
potential effect on the contract if the purchaser fails to make a payment or
makes a late payment under the contract or under an insurance policy if the
contract is insurance-funded;
(2)
the effect on the contract and on payments due if the contract beneficiary
dies:
(A) before the purchaser's payment
obligations have been fulfilled under a trust-funded contract; or
(B) if the contract is insurance-funded:
(i) during a period when an insurance policy
pays reduced benefits, if applicable; or
(ii) before the premium obligations have been
fulfilled on an insurance policy, if applicable;
(3) the conditions under which you
may owe a full or partial refund to the purchaser of funds received under a
contract, or a full or partial abandonment of your rights to anticipated
proceeds of an insurance policy if the contract is insurance-funded and
proceeds are not yet received, as a consequence of your inability (or the
provider's inability, if you are relying on another to perform portions of the
contract) to furnish the selected funeral goods and services; and
(4) a statement that the Prepaid Funeral
Guaranty Fund guarantees performance of the prepaid funeral seller and the
designated funeral provider, as well as associated administrative functions
required by law.
(h)
Changes to disposition or funeral goods and services at the death of contract
beneficiary. Your proposed prepaid funeral benefits contract must disclose the
circumstances under which the contract may be modified by the responsible
person at the death of the contract beneficiary, as required by Finance Code,
§
RSA
154.151(e). The disclosure
must appear exactly as set out in the model contract and in the following
figure, without modification, except that the phrase "fully funded" may be
substituted for the phrase "fully paid" wherever it appears in this disclosure
when used in an insurance-funded contract. In addition, you may use a larger
type size if feasible.
Attached
Graphic
(i)
Payment terms. Your proposed prepaid funeral benefits contract must clearly
state and explain payment terms and related provisions, including:
(1) how and when you will deposit a payment
received under a trust-funded contract, or forward any premiums received to the
insurance company for application to an insurance policy if the contract is
insurance-funded;
(2) with respect
to a trust-funded contract, whether and the extent to which you will retain a
portion of the purchaser's payments for reimbursement of your operating and
selling expenses;
(3) with respect
to a trust-funded contract, the finance charges you will impose, if applicable,
provided that the description must also comply with Finance Code, Chapter 345,
and other state and federal law governing such charges;
(4) subject to modifications or
clarifications required by §
RSA
25.2(a)(2) of this title,
with respect to an insurance-funded contract:
(A) the effect on the contract if insurance
coverage is denied and that all premiums will be returned to the policy
owner;
(B) if payment terms under
the insurance policy are not disclosed in the contract, a space for the
purchaser to initial or sign to acknowledge that the purchaser has received
written information regarding the terms governing premium payments in another
document that the purchaser received at the time of sale, such as the
application for insurance or the insurance policy;
(C) if the information the purchaser receives
regarding payment terms under an insurance policy is based on an estimate of
premiums, that must be noted;
(D)
notice and acknowledgement by the purchaser that insurance premiums paid on the
insurance policy or policies may be more or less than the total contract price,
and an estimate for total premiums to be paid. The disclosure must appear in
the payment terms section exactly as set out in the model contract and in the
following figure, without modification, including substantially the same
formatting and spacing:
Attached
Graphic
(E)
notice and acknowledgement by the purchaser if you initially issue insurance
policy(s) with an aggregate initial face value that exceed(s) the total
contract price by more than 5%. The disclosure must include the total amount of
the policy(s) in excess of 100% of the contract price. The disclosure must
appear in the payment terms section exactly as set out in the following figure,
without modification, including substantially the same formatting and spacing;
and,
Attached
Graphic
(5) other contract provisions that materially
relate to payment terms under a contract or under an insurance
policy.
(j) Required
signatures and notices. Your proposed prepaid funeral benefits contract must
contain a section for required signatures and related notices that appears in
its entirety on the last page of the contract, or near the bottom of the
contract if in electronic form. This section must include:
(1) a list of all items that must be received
or offered before the contract can be signed;
(2) if required by state or federal law,
cooling-off period language that includes spaces to note when and where the
contract was signed;
(3) notice
that the purchaser will receive a copy of the contract;
(4) notice that the purchaser is required to
be provided an informational brochure for contracts sold after June 1,
2010;
(5) the Department's prepaid
funeral contract informational website address;
(6) if the contract is insurance-funded:
(A) notice that the policy owner will receive
a copy of the insurance policy from the insurance company; or
(B) if the insurance company is not legally
required to deliver a copy of the insurance policy to the policy owner, notice
that the policy owner may request a copy of the insurance policy from the
insurance company;
(7)
spaces for:
(A) the purchaser's printed name,
mailing address, telephone number, social security number (if required), and
signature line;
(B) if you are not
directly providing the funeral goods and services, the printed name, mailing
address, and telephone number of the provider, and spaces for the printed name
and signature of the authorized officer or agent signing on behalf of the
provider;
(C) your printed name,
mailing address, and telephone number, and spaces for the printed name and
signature of the authorized officer or agent signing on your behalf;
and
(D) the printed name, mailing
address, and date of birth of the sole individual designated as contract
beneficiary; and
(8)
other provisions, party identifications, or certifications legally required for
valid execution of the contract.
(k) Inquiries and complaints notice. Your
proposed prepaid funeral benefits contract must disclose how a purchaser,
potential purchaser or consumer can make consumer inquiries and complaints to
the department as required by Finance Code, §
RSA
11.307(a), and §
RSA
25.41 of this title (relating to How Do I
Provide Information to Consumers on How to File a Complaint and What Action
Must I Take When I Receive a Complaint?), and to other specified state
regulatory agencies with appropriate jurisdiction.
(1) This disclosure must appear exactly as
set out in the relevant model contract, including the names and contact
information for each regulatory agency, without modification, and will vary in
context depending on whether the proposed contract is trust-funded or
insurance-funded. The model disclosures for both trust-funded and
insurance-funded contracts appear in:
Attached
Graphic
(2) If
the disclosure does not appear at the bottom of the last page of the contract
following the signatures of the parties, it must be placed at the top or bottom
of a preceding page and be separated from other contract text by at least 1/2
inches of white space. If the contract is in electronic form, the disclosure
must appear immediately preceding the area a purchaser can sign the contract.
The disclosure may not be placed on a page by itself.
(l) Additional requirements. A proposed
prepaid funeral benefits contract must also contain:
(1) page numbers, unless in an electronic
form that does not contain pages;
(2) a document title that discloses the
contract is for the purpose of prearranging a funeral, such as "Prepaid Funeral
Benefits Contract";
(3) a
distinguishing form number or name;
(4) your permit number; and
(5) a space for the contract number on at
least one of the contract pages.
(m) Your proposed non-model contract or
waiver form may contain:
(1) additional
contract clauses that are fair to consumers in light of the purpose of Finance
Code, Chapter 154; and
(2)
additional consumer disclosures that you determine:
(A) will assist the purchaser in
understanding the transaction; or
(B) are required by other state or federal
law for the type of transaction the contract represents.
(n) Electronic contract
requirements. A proposed non-model contract in electronic form must contain all
consumer disclosures required under Electronic Signatures in Global and
National Commerce Act,
RSA
7001, before any other provision and may be
on a separate screen.
