D. If the department determines after investigation or examination of a prearranged funeral trust account that a violation of any provision of this article has occurred, it shall send a written report to the board within thirty days of completion of the investigation or examination that includes an identification of the violation and any relevant documents. E. The department shall assess each funeral establishment at the rate of not more than $520 per day for each examiner employed in the examination of the establishment’s prearranged funeral trust accounts pursuant to the requirements of this section. 32-1391.04. Prearranged funeral trust accounts; books and records; inspection and examination A. All funeral establishments and financial institutions shall, on request of the department of insurance and financial institutions, make their prearranged funeral trust account books and records available for inspection and examination by the department. B. All financial institutions with trust funds deposited pursuant to this article shall at least quarterly send a copy to the department of each cancellation request or death certificate it has received that resulted in a withdrawal of funds from the trust account. C. A financial institution shall have no legal duty to inquire about the disbursement of any trust funds deposited pursuant to this article if the financial institution has received the properly executed notifications or certifications required by this article. D. A financial institution or funeral establishment operating according to the trust provisions established in this article shall not be considered in the trust business under title 6, chapter 8. 32-1391.05. Prearranged funeral agreements funded by trusts; definition A. All monies paid under a prearranged funeral agreement funded by trust, except as provided in subsection B of this section, shall be deposited, within five business days after the receipt of the monies, in a prearranged funeral trust account with a financial institution doing business in this state. The monies shall be invested either in federally insured accounts, in which case the amounts so deposited shall not exceed the amount of the deposit insurance, or in direct obligations of the United States government. Federally insured accounts are defined as accounts insured by the federal deposit insurance corporation or the national credit union administration board. If invested in direct obligations of the United States government, the maturity dates of such obligations shall not exceed three years, unless rules adopted by the department of insurance and financial institutions permit a longer period and not less than five percent of the amounts so deposited shall at all times be deposited in federally insured accounts. B. All monies paid under a fixed price prearranged funeral agreement funded by trust shall be deposited, within twenty-one calendar days or fifteen business days, whichever is shorter after the receipt of the monies, in a prearranged funeral trust account with a financial institution doing business in this state. In investing these monies the trustee shall exercise the judgment and care of a prudent investor under the prevailing circumstances. C. Except as provided in this article: 1. All monies deposited in a prearranged funeral trust account and all accrued interest shall be held in the trust account for and remain the property of the beneficiary during the beneficiary’s life and
On beginning a discussion regarding prearranged funeral agreements, a registered prearranged funeral salesperson or a licensed insurance producer who a funeral establishment employs or contracts with to sell prearranged funeral agreements funded by insurance shall present the price list to the consumer. The list shall be presented in an accurate and readable manner in order to facilitate price comparisons by consumers. C. A prearranged funeral agreement shall be funded by insurance or trust. A funeral establishment or an agent or employee of a funeral establishment shall not accept payment for or agree to enter into any prearranged funeral agreement unless the name of a licensed funeral establishment appears on the statement of goods and services used in connection with the agreement and one of the following is true: 1. If the agreement is a prearranged funeral agreement funded by insurance, the funeral establishment employs or contracts with insurance producers who are licensed pursuant to title 20 to sell the funeral agreement. 2. If the agreement is a prearranged funeral agreement funded by trust, the establishment has been issued a prearranged funeral sales endorsement to its license and the salesperson has been issued a prearranged funeral salesperson registration by the board allowing the establishment and the person to sell prearranged funeral agreements funded by trust. 3. If the agreement is a payable on death account, the account is not under the control of the establishment. A funeral establishment or an agent or employee of a funeral establishment shall not accept a deposit for a payable on death account. 32-1391.03. Department of insurance and financial institutions powers and duties; prearranged funeral trust accounts A. The department of insurance and financial institutions shall determine all of the following in its examinations of prearranged funeral trust accounts: 1. The names and addresses of purchasers of prearranged funerals and the amount each purchaser paid to the funeral establishment. 2. The location and status of all monies received. 3. The total amount in trust accounts. 4. Whether a funeral establishment is complying with this article and rules adopted pursuant to this article. 5. Whether a funeral establishment is following recognized accounting procedures for prearranged B. The department shall: 1. Conduct examinations on a random basis or in connection with an investigation pursuant to procedures established by the board. funeral trust accounts and handling monies received from prearranged funeral sales. 2. Examine the prearranged funeral trust accounts of each funeral establishment at least once within the first twelve months after it begins to sell prearranged funerals and at least once every three years thereafter. 3. Include prearranged funeral trust accounts established before January 1, 1985, in its examinations. C. The department may examine and investigate prearranged funeral trust accounts pursuant to title 6, chapter 1, article 3 and pursuant to the powers of the board concerning prearranged funeral sales and trust accounts.
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Book Code: FAZ0625
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