HB 453 (BR 1144) - R. Damron
AN ACT relating to life insurance.
Amend KRS 304.15-020 to define terms; amend KRS 304.15-700 to set forth certain requirements for applicants for a viatical settlement broker license; to require the Commissioner of the Department of Insurance to promulgate administrative regulations; to require a provider to give a copy of any trust agreement to the commissioner; to establish a fiduciary responsibility for the viatical settlement broker to the viator; create new sections of subtitle 15 of KRS Chapter 304 to establish that the provider is responsible for the actions of the broker; amend KRS 304.15-705 to require that viatical records transactions be maintained for 5 years; to establish that the Kentucky Secretary of State receive service of lawful process; amend KRS 304-15-715 to require all parties to give prior written notice before assignment; to require a provider to notify the insurer when a policy has been viaticated within 10 days of the rescission period; create new sections of subtitle 15 of KRS Chapter 304 to require the department to issue cease and desist orders for cause; to allow the department to impose and collect administrative fines for violations of a cease and desist order; to establish what are unlawful acts regarding viaticals; to disallow a broker from receiving a finder's fee and commission; to require a viatical settlement transaction to be completed through an independent third-party trustee; to establish that a viatical settlement contract is rescinded if the insured dies during the rescission period; to establish that if the time or amount under an accelerated benefits provision is equal to or greater than the viatical settlement the settlement is prohibited from being negotiated; to allow the commissioner to seek an injunction to prevent further violations; to allow a civil cause of action; to establish that the 2 year incontestability period does not apply to viatical transactions if all medical conditions are not disclosed; amend KRS 304.15-710 to require full disclosure and a consumer guide to be provided on the date the contract is signed and additional disclosures required; create a new section of subtitle 15 of KRS Chapter 304 to establish that only 1 trust can be utilized and that the trustee will be the settlement provider and will be liable and responsible for the performance of all obligations of the trust; amend KRS 304.42-190 to prohibit the use of the Kentucky Guaranty Association as an inducement to purchase; create new sections of subtitle 99 of KRS Chapter 304 to require that a licensee will conclude affairs and will not solicit, negotiate, or effectuate new contracts in the event of suspension of the license; to establish that civil fines for each violation can range from $1,000 to $25,000; to require the department to refer violations to the Division of Insurance Fraud Investigation if appropriate.
HB 453 - AMENDMENTS
HCS - Amend KRS 304.15-700 to require all applicants for a viatical settlement broker license to attend training and to pass a viatical broker examination; applicants for viatical broker or provider licenses required to file with commissioner evidence of financial responsibility in specified amounts; and create a new section of Subtitle 15 of KRS Chapter 304 to require a viatical settlement transaction to be completed through an independent third-party trustee, and within three (3) business days of receipt of a signed viatical settlement contract from the viator the viatical settlement provider shall pay the proceeds to the viator and any commission due the broker to the trust managed by the independent third-party trustee.
Jan 24-introduced in House
Jan 25-to Banking and Insurance (H)
Feb 2-posted in committee
Feb 10-reported favorably, 1st reading, to Calendar with Committee Substitute
Feb 14-2nd reading, to Rules
Feb 15-posted for passage in the Regular Orders of the Day for Wednesday, February 16, 2000
Feb 25-3rd reading, passed 93-0 with Committee Substitute
Feb 28-received in Senate
Mar 1-to Banking and Insurance (S)
Mar 21-reported favorably, 1st reading, to Consent Calendar
Mar 22-2nd reading, to Rules
Mar 27-posted for passage in the Consent Orders of the Day for Monday, March 27, 2000
Mar 29-3rd reading, passed 37-0; received in House; enrolled, signed by Speaker of the House
Apr 11-enrolled, signed by President of the Senate; delivered to Governor
Apr 21-signed by Governor (Acts ch. 472)