HF 2956

as introduced - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to insurance; regulating the sale of annuity 
  1.3             contracts with surrender charges to elderly customers; 
  1.4             amending Minnesota Statutes 2000, section 72A.20, 
  1.5             subdivision 34. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 2000, section 72A.20, 
  1.8   subdivision 34, is amended to read: 
  1.9      Subd. 34.  [SUITABILITY OF INSURANCE FOR CUSTOMER.] (a) In 
  1.10  recommending or issuing life, endowment, individual accident and 
  1.11  sickness, long-term care, annuity, life-endowment, or Medicare 
  1.12  supplement insurance to a customer, an insurer, either directly 
  1.13  or through its agent, must have reasonable grounds for believing 
  1.14  that the recommendation is suitable for the customer.  
  1.15     In the case of group insurance marketed on a direct 
  1.16  response basis without the use of direct agent contact, this 
  1.17  subdivision is satisfied if the insurer has reasonable grounds 
  1.18  to believe that the insurance offered is generally suitable for 
  1.19  the group to whom the offer is made. 
  1.20     (b) An annuity contract recommended or issued to a person 
  1.21  who is 80 years of age or older is unsuitable if the annuity 
  1.22  contract includes a surrender charge.  This paragraph does not 
  1.23  apply if: 
  1.24     (1) a relative, friend, or professional financial advisor 
  1.25  is with the purchaser at the time of entering into the annuity 
  2.1   contract; or 
  2.2      (2) the purchaser presents the insurance company or agent 
  2.3   with a written opinion from an attorney; certified public 
  2.4   accountant; or financial planner, as defined in section 45.026, 
  2.5   subdivision 1, paragraph (b), stating that the annuity contract 
  2.6   is appropriate for the purchaser; the opinion must specifically 
  2.7   address the age of the prospective purchaser and the existence 
  2.8   of the surrender charges. 
  2.9      The purchaser of an annuity contract that is unsuitable 
  2.10  under this paragraph is entitled, upon the request of the 
  2.11  purchaser, to a full refund of all payments made to the 
  2.12  insurance company, plus accrued interest, reduced by any 
  2.13  payments received by the purchaser. 
  2.14     If this paragraph does not apply due to compliance with 
  2.15  clause (1) or (2), then paragraph (a) applies.