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Senate
File
2148
-
Introduced
SENATE
FILE
2148
BY
COMMITTEE
ON
COMMERCE
(SUCCESSOR
TO
SSB
3058)
A
BILL
FOR
An
Act
relating
to
preneed
sellers,
sales
agents
and
sales
1
agent
applicants,
and
government
cemeteries.
2
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
3
TLSB
5513SV
(1)
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S.F.
2148
Section
1.
Section
22.7,
subsection
58,
Code
2026,
is
1
amended
to
read
as
follows:
2
58.
Information
filed
with
the
commissioner
of
insurance
3
pursuant
to
sections
523A.204
,
523A.205
,
523A.206
,
523A.207
,
4
523A.401
,
523A.502A
,
and
523A.803
.
5
Sec.
2.
Section
523A.102,
subsection
7,
Code
2026,
is
6
amended
by
striking
the
subsection.
7
Sec.
3.
Section
523A.201,
subsection
8,
Code
2026,
is
8
amended
to
read
as
follows:
9
8.
Interest
or
income
earned
on
amounts
deposited
in
trust
10
shall
remain
in
trust
under
the
same
terms
and
conditions
11
as
payments
made
under
the
purchase
agreement,
except
that
12
a
seller
may
withdraw
so
much
of
the
interest
or
income
as
13
represents
the
difference
between
the
amount
needed
to
adjust
14
the
trust
funds
for
inflation
as
set
by
the
commissioner
based
15
on
the
most
recently
released
consumer
price
index
for
all
16
urban
consumers
published
by
the
United
States
department
17
of
labor,
bureau
of
labor
statistics,
and
the
interest
or
18
income
earned
during
the
immediately
preceding
year
not
to
19
exceed
fifty
percent
of
the
total
interest
or
income
on
a
20
calendar-year
basis.
The
early
Early
withdrawal
of
interest
or
21
income
under
this
provision
does
subsection
shall
not
affect
22
the
purchaser’s
right
to
a
credit
of
such
interest
or
income
in
23
the
event
of
a
nonguaranteed
price
agreement,
cancellation,
or
24
nonperformance
by
such
a
the
seller.
25
Sec.
4.
Section
523A.206,
subsection
1,
Code
2026,
is
26
amended
to
read
as
follows:
27
1.
The
commissioner
may
conduct
an
examination
under
28
this
chapter
of
any
seller
as
often
as
the
commissioner
29
deems
appropriate.
If
a
seller
has
a
trust
arrangement,
the
30
commissioner
shall
conduct
an
examination
of
such
seller
doing
31
business
in
this
state
not
less
than
once
every
five
years
32
unless
the
seller
has
provided
to
the
commissioner,
on
an
33
annual
basis,
a
certified
copy
of
an
audit
conducted
by
an
34
independent
certified
public
accountant
verifying
compliance
35
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with
this
chapter
.
The
commissioner
may
require
a
seller
1
to
provide
a
certified
copy
of
an
audit
of
a
the
seller
,
or
2
other
person
conducted
by
a
an
independent
certified
public
3
accountant
to
verify
compliance
with
the
requirements
of
this
4
chapter
,
including
rules
adopted
and
orders
issued
pursuant
to
5
this
chapter
.
6
Sec.
5.
Section
523A.502,
subsection
1,
Code
2026,
is
7
amended
to
read
as
follows:
8
1.
a.
A
person
shall
not
advertise,
sell,
promote,
or
offer
9
to
furnish
cemetery
merchandise,
funeral
merchandise,
funeral
10
services,
or
a
combination
thereof
when
performance
or
delivery
11
may
be
more
than
one
hundred
twenty
days
following
initial
12
payment
on
the
account
unless
the
person
has
a
sales
license
13
and
is
a
sales
agent
of
a
person
holding
a
preneed
seller’s
14
license.
The
15
b.
A
preneed
seller
licensee
is
liable
for
the
acts
of
its
16
the
licensee’s
sales
agents
performed
in
advertising,
selling,
17
promoting,
or
offering
to
furnish,
upon
the
future
death
of
18
a
person
named
or
implied
in
a
purchase
agreement,
cemetery
19
merchandise,
funeral
merchandise,
funeral
services,
or
a
20
combination
thereof.
21
c.
(1)
Prior
to
being
issued
a
sales
license,
an
applicant
22
for
a
sales
license
shall
be
designated
by
at
least
one
preneed
23
seller
to
sell,
negotiate,
or
solicit
purchase
agreements
24
on
behalf
of
the
preneed
seller.
At
the
time
an
individual
25
submits
an
application
for
a
sales
license,
the
preneed
26
seller
shall
file,
in
a
format
approved
by
the
commissioner,
27
documentation
of
the
designation
of
the
applicant
to
sell,
28
negotiate,
or
solicit
purchase
agreements
on
behalf
of
the
29
preneed
seller.
30
(2)
A
sales
license
shall
not
be
issued
to
a
sales
31
license
applicant
until
the
applicant
has
met
all
licensure
32
requirements
of
this
chapter.
33
(3)
The
preneed
seller
shall
disclose
to
the
commissioner
34
any
changes
made
to
the
designation
for
a
sales
agent
to
sell,
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negotiate,
or
solicit
preneed
contracts
on
the
preneed
seller’s
1
behalf
within
thirty
calendar
days
of
the
date
of
the
change
2
in
designation.
3
d.
The
license
of
a
sales
agent
shall
not
be
effective
4
during
any
time
period
during
which
the
sales
agent
is
not
5
employed
by
or
associated
with
a
preneed
seller
licensed
under
6
this
chapter.
7
Sec.
6.
Section
523A.502,
subsection
5,
Code
2026,
is
8
amended
to
read
as
follows:
9
5.
A
sales
license
shall
expire
annually
on
April
30.
If
10
a
sales
agent
has
filed
an
annual
report
pursuant
to
section
11
523A.502A,
subsection
1
,
and
has
fulfilled
the
continuing
12
education
requirements
pursuant
to
subsection
6
and
has
paid
13
the
required
renewal
fee
,
the
commissioner
shall
renew
the
14
sales
agent’s
sales
license
until
April
30
of
the
following
15
year
.
16
Sec.
7.
Section
523A.601,
subsection
1,
paragraph
i,
Code
17
2026,
is
amended
to
read
as
follows:
18
i.
Include
an
explanation
of
regulatory
oversight
by
19
the
insurance
division
in
twelve
point
boldface
type,
in
20
substantially
the
following
language:
21
This
agreement
is
subject
to
rules
administered
by
the
Iowa
22
insurance
division.
You
may
call
contact
the
Iowa
insurance
23
division
with
inquiries
or
complaints
at
(telephone
number).
24
Written
inquiries
or
complaints
should
be
mailed
to
the
Iowa
25
securities
and
regulated
industries
bureau,
(street
address),
26
(city),
Iowa
(zip
code)
iid.iowa.gov
.
27
Sec.
8.
Section
523A.602,
subsection
2,
paragraph
b,
28
subparagraph
(1),
Code
2026,
is
amended
to
read
as
follows:
29
(1)
If
a
purchase
agreement
is
canceled,
a
purchaser
30
requests
a
transfer
of
the
trust
assets
upon
cancellation
of
a
31
purchase
agreement,
or
another
seller
provides
merchandise
or
32
services
designated
in
a
purchase
agreement,
the
seller
shall
33
refund
or
transfer
within
thirty
days
of
receiving
a
written
34
demand
no
less
than
the
purchase
price
of
the
applicable
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2148
cemetery
merchandise,
funeral
merchandise,
and
funeral
services
1
adjusted
for
inflation,
using
the
most
recently
released
2
consumer
price
index
amounts
announced
by
the
commissioner
3
annually
for
all
urban
consumers
published
by
the
United
4
States
department
of
labor,
bureau
of
labor
statistics
,
less
5
any
actual
expenses
incurred
by
the
seller
pursuant
to
the
6
purchase
agreement
as
set
forth
in
the
purchase
agreement
under
7
section
523A.601,
subsection
1
,
paragraph
“f”
.
The
amount
of
8
the
actual
expenses
deducted
by
the
seller
shall
not
exceed
9
ten
percent
of
the
purchase
price
of
the
applicable
cemetery
10
merchandise,
funeral
merchandise,
and
funeral
services.
The
11
seller
may
also
deduct
the
value
of
the
cemetery
merchandise,
12
funeral
merchandise,
and
funeral
services
already
received
by,
13
delivered
to,
or
warehoused
for
the
purchaser.
14
Sec.
9.
Section
523A.602,
subsection
2,
paragraph
c,
Code
15
2026,
is
amended
to
read
as
follows:
16
c.
A
purchase
agreement
must
include
a
statement
that
the
17
purchaser
is
entitled
to
a
refund
of
the
purchase
price
of
18
the
applicable
funeral
merchandise
adjusted
for
inflation,
19
using
the
most
recently
released
consumer
price
index
amounts
20
announced
by
the
commissioner
annually
for
all
urban
consumers
21
published
by
the
United
States
department
of
labor,
bureau
22
of
labor
statistics,
for
any
item
of
funeral
merchandise
23
that
cannot
be
delivered
to
the
location
specified
in
the
24
purchase
agreement
within
forty-eight
hours
of
notice
of
the
25
individual’s
death,
unless
the
delay
is
caused
by
weather
26
conditions
or
a
natural
disaster.
The
seller
must
return
such
27
refund
to
the
purchaser
within
thirty
days
of
receiving
the
28
written
demand.
29
Sec.
10.
Section
523A.807,
subsection
3,
unnumbered
30
paragraph
1,
Code
2026,
is
amended
to
read
as
follows:
31
If
the
commissioner
finds
that
a
person
has
violated
32
section
523A.201
,
523A.202
,
523A.203
,
523A.204
,
523A.207
,
33
523A.401
,
523A.402
,
523A.403
,
523A.404
,
523A.405
,
523A.501
,
34
523A.502
,
523A.502A
,
523A.505
,
or
523A.605
,
or
any
rule
adopted
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pursuant
thereto,
the
commissioner
may
order
any
or
all
of
the
1
following:
2
Sec.
11.
Section
523I.102,
subsections
9,
16,
and
45,
Code
3
2026,
are
amended
by
striking
the
subsections.
4
Sec.
12.
Section
523I.102,
Code
2026,
is
amended
by
adding
5
the
following
new
subsections:
6
NEW
SUBSECTION
.
13A.
“Government
cemetery”
means
a
cemetery
7
that
is
owned,
operated,
or
controlled
by
a
governmental
8
subdivision.
9
NEW
SUBSECTION
.
13B.
“Governmental
subdivision”
means
a
10
city,
county,
or
township.
11
Sec.
13.
Section
523I.102,
subsection
37,
Code
2026,
is
12
amended
to
read
as
follows:
13
37.
a.
“Perpetual
care
cemetery”
includes
all
of
the
14
following:
15
a.
(1)
Any
cemetery
that
was
organized
or
commenced
16
business
in
this
state
on
or
after
July
1,
1995.
17
b.
(2)
Any
cemetery
that
has
established
a
care
fund
in
18
compliance
with
section
523I.810
.
19
c.
(3)
Any
cemetery
that
represents
that
it
is
a
perpetual
20
care
cemetery
in
its
interment
rights
agreement.
21
d.
(4)
Any
cemetery
that
represents
in
any
other
manner
22
that
the
cemetery
provides
perpetual,
permanent,
or
guaranteed
23
care.
24
b.
“Perpetual
care
cemetery”
does
not
include
a
government
25
cemetery.
26
Sec.
14.
Section
523I.213A,
subsection
1,
Code
2026,
is
27
amended
to
read
as
follows:
28
1.
The
commissioner
or
the
commissioner’s
designee
may
29
conduct
an
examination
under
this
chapter
of
any
cemetery
as
30
often
as
the
commissioner
deems
appropriate.
If
a
cemetery
31
has
a
trust
arrangement,
the
commissioner
shall
conduct
an
32
examination
not
less
than
once
every
five
years.
33
Sec.
15.
Section
523I.312,
subsection
2,
paragraph
n,
Code
34
2026,
is
amended
to
read
as
follows:
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2148
n.
Include
an
explanation
of
regulatory
oversight
by
1
the
insurance
division
in
twelve
point
boldface
type,
in
2
substantially
the
following
language:
3
This
agreement
is
subject
to
rules
administered
by
the
Iowa
4
insurance
division.
You
may
call
contact
the
Iowa
insurance
5
division
with
inquiries
or
complaints
at
(insert
telephone
6
number).
Written
inquiries
or
complaints
should
be
mailed
7
to:
Iowa
Securities
and
Regulated
Industries
Bureau,
(insert
8
address)
iid.iowa.gov
.
9
Sec.
16.
Section
523I.501,
Code
2026,
is
amended
to
read
as
10
follows:
11
523I.501
Cemetery
authorized.
12
The
governing
body
of
a
governmental
subdivision
may
13
purchase,
establish,
operate,
enclose,
improve,
or
regulate
14
a
cemetery.
A
government
cemetery
owned
or
operated
by
a
15
governmental
subdivision
may
sell
interment
rights
subject
to
16
the
provisions
of
this
chapter
.
17
Sec.
17.
Section
523I.801,
subsection
1,
Code
2026,
is
18
amended
to
read
as
follows:
19
1.
All
cemeteries
are
designated
as
either
“perpetual
care
20
cemeteries”
,
or
“nonperpetual
care
cemeteries”
,
or
“government
21
cemeteries”
for
the
purposes
of
this
chapter
.
A
cemetery
that
22
represents
that
it
is
offering
perpetual
care
on
or
after
July
23
1,
2005,
is
subject
to
this
subchapter
.
This
subchapter
shall
24
not
apply
to
government
cemeteries.
25
Sec.
18.
Section
523I.805,
subsection
1,
Code
2026,
is
26
amended
to
read
as
follows:
27
1.
A
cemetery
owned
or
operated
by
a
political
subdivision
28
of
this
state
is
not
required
to
make
a
minimum
initial
deposit
29
in
a
care
fund.
Any
other
cemetery
commencing
business
in
this
30
state
on
or
after
July
1,
2005,
shall
not
sell
interment
spaces
31
unless
the
cemetery
has
a
care
fund
of
at
least
twenty-five
32
thousand
dollars
in
cash.
33
Sec.
19.
Section
523I.810,
subsection
1,
paragraph
f,
34
unnumbered
paragraph
1,
Code
2026,
is
amended
to
read
as
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9
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2148
follows:
1
If
the
amount
of
a
care
fund
exceeds
two
hundred
thousand
2
dollars,
the
cemetery
or
any
officer,
director,
agent,
3
employee,
or
affiliate
of
the
cemetery
shall
not
serve
as
4
trustee
unless
the
cemetery
is
a
cemetery
owned
or
operated
5
by
a
governmental
subdivision
of
this
state
.
A
financial
6
institution
holding
care
funds
shall
not
do
any
of
the
7
following:
8
Sec.
20.
REPEAL.
Sections
523A.502A
and
523I.401,
Code
9
2026,
are
repealed.
10
EXPLANATION
11
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
12
the
explanation’s
substance
by
the
members
of
the
general
assembly.
13
This
bill
relates
to
preneed
sellers,
sales
agents
and
sales
14
agent
applicants,
and
government
cemeteries.
15
The
bill
amends
Code
sections
523A.201(8)
(establishment
16
of
trust
funds),
523A.602(2)(b)(1)
(consumer
rescission,
17
cancellation,
and
refund
rights
——
purchase
agreement
18
compliance
with
other
laws),
and
523A.602(2)(c)
to
calculate
19
the
rate
of
inflation
by
relying
on
the
most
recently
released
20
consumer
price
index
for
all
urban
consumers
published
by
the
21
United
States
department
of
labor,
bureau
of
labor
statistics,
22
rather
than
relying
on
the
inflation
as
set
by
the
commissioner
23
of
insurance
(commissioner)
based
on
the
consumer
price
index
24
under
current
law.
25
The
bill
eliminates
the
requirement
under
current
law
that
26
if
a
preneed
seller
has
a
trust
agreement,
the
commissioner
27
shall
conduct
an
examination
of
the
preneed
seller
at
least
28
once
every
five
years
unless
the
preneed
seller
has
annually
29
provided
to
the
commissioner
a
certified
copy
of
an
audit
30
conducted
by
an
independent
certified
public
accountant.
Under
31
the
bill,
the
commissioner
may
require
a
preneed
seller
to
32
provide
a
certified
copy
of
an
audit
of
the
preneed
seller
33
conducted
by
an
independent
certified
public
accountant
to
34
verify
compliance.
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Under
the
bill,
prior
to
being
issued
a
sales
license,
an
1
applicant
for
a
sales
license
must
be
designated
by
a
preneed
2
seller
to
sell,
negotiate,
or
solicit
purchase
agreements
3
on
behalf
of
the
preneed
seller.
At
the
time
the
applicant
4
submits
their
application
for
a
sales
license,
the
preneed
5
seller
shall
file
documentation
of
the
designation
for
the
6
applicant
to
sell,
negotiate,
or
solicit
purchase
agreements
7
on
behalf
of
the
preneed
seller.
A
license
as
a
sales
agent
8
shall
not
be
issued
to
an
applicant
unless
they
have
met
all
9
licensure
requirements
and
the
insurance
division
(division)
10
has
received
a
designation
by
a
preneed
seller.
A
preneed
11
seller
must
disclose
to
the
commissioner
changes
made
to
the
12
designation
of
a
sales
agent
authorized
to
conduct
business
on
13
the
preneed
seller’s
behalf
within
30
days
of
a
designation
14
change.
A
sales
agent
license
shall
not
be
effective
during
15
a
time
period
in
which
the
sales
agent
is
not
employed
by
or
16
associated
with
a
preneed
seller.
17
Under
the
bill,
for
a
sales
agent
to
renew
their
license,
the
18
sales
agent
must
pay
a
renewal
fee.
Payment
of
a
renewal
fee
is
19
not
required
under
current
law.
20
The
bill
amends
Code
sections
523A.601(1)(i)
(disclosures)
21
and
523I.312(2)(n)
(disclosure
requirements
——
interment
22
agreements)
to
clarify
the
manner
in
which
to
contact
the
23
division
by
directing
inquiries
and
complaints
to
the
24
division’s
internet
site,
rather
than
by
telephone
or
mail
25
under
current
law.
26
The
bill
eliminates
the
requirement
that
the
commissioner
27
or
the
commissioner’s
designee
conduct
an
examination
no
less
28
than
once
every
five
years
of
any
cemetery
that
has
a
trust
29
arrangement.
30
Under
the
bill,
all
cemeteries
under
Code
chapter
523I
(Iowa
31
cemetery
Act)
are
designated
as
perpetual
care
cemeteries,
32
nonperpetual
care
cemeteries,
or
government
cemeteries.
33
“Government
cemetery”
is
defined
in
the
bill.
Under
the
bill,
34
Code
chapter
523I,
subchapter
VIII
(perpetual
care
cemeteries
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——
requirements),
shall
not
apply
to
government
cemeteries.
1
Under
current
law,
a
cemetery
owned
or
operated
by
a
2
political
subdivision
is
not
required
to
make
a
minimum
initial
3
deposit
in
a
care
fund,
and
may
serve
as
a
trustee.
The
bill
4
eliminates
these
exceptions.
5
The
bill
repeals
Code
sections
523A.502A
(sales
agent
annual
6
reporting
requirements)
and
523I.401
(neglected
cemeteries),
7
and
makes
conforming
changes
to
Code
sections
22.7(58)
and
8
523A.807(3).
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