Current through Register Vol. 41, No. 3, September 23, 2024
A. Where a replacement is involved in the
transaction, the replacing insurer shall:
1.
Verify that the required forms are received and are in compliance with this
chapter;
2. Notify any other
existing insurer that may be affected by the proposed replacement within five
business days of receipt of a completed application indicating replacement or
when the replacement is identified, if not indicated on the application, and
mail a copy of the available illustration or policy summary for the proposed
policy or available disclosure document for the proposed contract within five
business days of a request from an existing insurer;
3. Be able to produce copies of the
notification regarding replacement required in
14VAC5-30-40 B, indexed by agent,
for at least five years; and
4.
Provide to the policy or contract owner notice of the right to examine the
policy or contract for at least 10 days from the delivery of the policy or
contract and the right of return to receive an unconditional full refund of all
premiums or considerations paid on it, including any policy fees or charges or,
in the case of a variable or market value adjustment contract, a payment of the
cash surrender value provided under the contract plus the fees and other
charges deducted from the gross premiums or considerations or imposed under the
contract. The notice may be included in Form 30-A or 30-C.
B. In transactions where the replacing
insurer and the existing insurer are the same or subsidiaries or affiliates
under common ownership or control, credit shall be allowed for the period of
time that has elapsed under the replaced policy's or contract's
incontestability and suicide period up to the face value of the existing policy
or contract. With regard to financed purchases, the credit may be limited to
the amount the face value of the existing policy is reduced by the use of
existing policy values to fund the new policy or contract.
C. If an insurer prohibits the use of
marketing communication other than that approved by the company, as an
alternative to the requirements made of an insurer pursuant to
14VAC5-30-40 E, the insurer may:
1. Require with each application a statement
signed by the agent that:
a. Represents that
the agent used only company-approved marketing communications; and
b. States that copies of all marketing
communications were left with the applicant in accordance with
14VAC5-30-40 D; and
2. Within 10 days of the issuance
of the policy or contract:
a. Notify the
applicant by sending a letter or by verbal communication with the applicant by
a person whose duties are separate from the marketing area of the insurer, that
the agent has represented that copies of all marketing communications have been
left with the applicant in accordance with
14VAC5-30-40 D;
b. Provide the applicant with a toll-free
number to contact company personnel involved in the compliance function if
compliance did not occur;
c. Stress
the importance of retaining copies of the marketing communications for future
reference; and
3. Be
able to produce a copy of the letter or other verification in the policy file
for at least five years after the termination or expiration of the policy or
contract.
Statutory Authority
§§ 12.1-13 and 38.2-223 of the Code of Virginia.
